In the Netherlands, credit cooperatives are classified as financial institutions, and therefore subject to the law governing credit institutions. This means subordination to strict rules in terms of supervision, solvency, disclosure, etc.
Supervision of credit institutions largely unified in the entire European Union. Several European standards determine the content of the laws that regulate certain types of banking activities and supervision of authorized credit institutions.
Here are a few important rules:
– rules and licensing activities of credit institutions
– merger rules
– rules relating to capital adequacy
– rules relating to the Deposit Insurance System
These rules are based on the recommendations of the Basel Committee. Together with the help of which is considered necessary in the Netherlands, these European rules were included in the Act on the Supervision of credit institutions from 1992.
This law regulates the activities of all credit institutions in the Netherlands, whether a commercial bank or a credit cooperative . The only exception is the Rabobank. Central Bank of the Netherlands (DNB) does not carry out separate supervision of each of 370 banks – members of Rabobank. It controls only “Rabobank Nederland” located in the city of Utrecht, and control over the activities of other small Rabobanks.
Recent developments in the Netherlands, which are expected to lead to changes in the legal regulation of credit cooperatives, associated with several financial scandals that took place in separate Rabobanks.