Assuming you have a mortgage of 700K CHF (i.e. minus, debts)

But you have 300K CHF in liquid assets on your savings account.

If the bank goes bankrupt, you have 100K guaranteed back in Switzerland (law).

Deposit insurance or deposit protection is a measure implemented in many countries to protect bank depositors, in full or in part, from losses caused by a bank's inability to pay its debts when due. Deposit insurance systems are one component of a financial system safety net that promotes financial stability.

In my fictitious example: would you get the whole 300K in case of bankruptcy of the bank? How are debts calculated in this 100K?

  • 1
    The answer will depend on whether the debts in each direction can be "set-off" against each other. This is typically quite jurisdiction-specific and perhaps contract-specific, so answers from a global or US perspective won't tell you very much. This article mentions a right of set-off but doesn't comment about whether it applies to bank deposits or not. Jan 9 at 20:39

2 Answers 2


What may happen is that you get 100K CHF out of your liquid deposits from the insurance and lose the remaining 200K (or, rather, become a creditor to the failed bank, in line with all the other creditors, and the bankruptcy court will determine how much of this 200K you'll eventually get).

The mortgage on the other hand is the asset of the bank and will be sold to whoever takes over the bank in order to satisfy the bank's debts (including your 200K). You'll continue owing the same 700K CHF, just to someone else now.


I can't speak to the legal frame work in Switzerland, but typically in the US, if the mortgagee (the bank) goes bankrupt, the mortgage will be sold to another lender and the funds raised will be used to pay off the mortgagee's creditors. The principal and payment schedule for the mortgage will typically not be affected. You'll just make the payments to a different institution. The deposit insurance is paid by the insurer, not the bank. They will pay out a maximum of 100k. For the remaining 200k, you are a creditor of the bank, and will be standing in line with the other creditors. Whether or not you see any of that money will depend on how much money the bank can raise in dissolution and the specific repayment priorities set by local bankruptcy law.

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