Single Supervisory Mechanism (SSM) – Supervisory fees

SUMMARY OF:

Regulation (EU) No 1024/2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions

Regulation (EU) No 1163/2014 on supervisory fees (ECB/2014/41)

Decision (EU) 2019/2158 on the methodology and procedures for the determination and collection of data regarding fee factors used to calculate annual supervisory fees (ECB/2019/38)

WHAT IS THE AIM OF THE REGULATIONS AND DECISIONS?

• Regulation (EU) No 1024/2013 lists specific tasks for the European Central Bank (ECB) including levying an annual supervisory fee* on credit institutions*.
• Regulation (EU) No 1163/2014 (ECB/2014/41) lays down the methodology and criteria for calculating the total amount of annual supervisory fees, their breakdown by supervised entity and supervised group and how the ECB collects them.
• Decision (EU) 2019/2158 (ECB/2019/38) contains the methodology and procedures to determine and collect data on factors used to calculate the annual supervisory fees.

KEY POINTS

Regulation (EU) No 1024/2013 establishes, in its Article 30, the principle of the payment of supervisory fees. It states that:

• the ECB:
  • levies an annual fee on all banks and branches falling within the scope of European banking supervision to cover the cost of its tasks and responsibilities;
  • establishes how to calculate the fees after conducting public consultations and analysing potential costs and benefits;
  • may require advance payments of the fee based on a reasonable estimate;
• supervisory fees:
  • are based on, and should not be higher than, the ECB’s expenditure on the specific supervisory tasks;
  • are determined by objective criteria linked to the importance and risk profile of the particular credit institution, including its risk weighted assets;
  • national authorities may levy fees under national law for costs they incur.

Regulation (EU) No 1163/2014 (ECB/2014/41) states that:

• the ECB levies an annual supervisory fee from each supervised credit institution or branch (the fee debtor*) established in a participating Member State;
• the annual supervisory fees to be levied on the supervised entities are calculated on the basis of the expenses incurred by the ECB in the relevant fee period that are directly or indirectly related to its supervisory tasks;
• total assets and total risk exposure (each 50%) of the fee debtor determine the annual fees. Specific rules apply to:
  • new supervised entities and entities no longer supervised or whose status has changed;
  • the split of annual costs between significant and less significant supervised entities;
  • the minimum fee component (a fixed 10% of the annual supervisory fee). This may be halved for entities and groups with total assets below specific thresholds;
• the ECB:
  • cooperates with national competent authorities to ensure supervision remains cost-effective and reasonable for all credit institutions and branches;
  • issues fee notices annually to each fee debtor within 6 months of the fee following period and the amount due is to be paid within 35 days of the date of issuance of the fee notice;
  • applies interest on any outstanding amounts of the supervisory fee;
  • may impose sanctions;
  • submits an annual report to the European Parliament, Council of the European Union, European Commission and Eurogroup.

Decision (EU) 2019/2158 (ECB/2019/38) states that:

• the ECB determines the respective fee factors in accordance with the total risk exposure amount and total assets for supervised entities and groups;
• fee debtors intending to exclude assets and/or risk exposure of subsidiaries in non-participating Member States or in non-EU countries must notify the ECB;
• national competent authorities ensure the quality and reliability of the fee factors they receive in standard templates from fee debtors before submitting them to the ECB.

Total annual supervisory fees

• Starting with 2015 the ECB issues every year a decision on total annual supervisory fees.
• The 2021 decision (Decision (EU) 2021/490) notes that beginning with the 2020 fee period the supervisory fees are levied only after the end of the relevant fee period when the actual annual costs have been determined and that advance payments are no longer required.

FROM WHEN DO THE REGULATIONS AND DECISIONS APPLY?

• Regulation (EU) No 1024/2013 has applied since 3 November 2013.
• Regulation (EU) No 1163/2014 has applied since 5 November 2014.
• Decision (EU) 2019/2158 has applied since 1 January 2020.

BACKGROUND

The ECB ensures the Single Supervisory Mechanism works consistently and efficiently. It supervises significant banks (determined by size and total value) directly and less significant ones indirectly. Therefore, all supervised banks pay a supervisory fee.

For further information, see:

• Single Supervisory Mechanism (European Central Bank)
• Supervisory practices (European Central Bank)
• Supervisory fees (European Central Bank).

KEY TERMS

MAIN DOCUMENTS

Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ L 287, 29.10.2013, pp. 63–89).

Regulation (EU) No 1163/2014 of the European Central Bank of 22 October 2014 on supervisory fees (ECB/2014/41) (OJ L 311, 31.10.2014, pp. 23–31).

See consolidated version.

Decision (EU) 2019/2158 of the European Central Bank of 5 December 2019 on the methodology and procedures for the determination and collection of data regarding fee factors used to calculate annual supervisory fees (ECB/2019/38) (OJ L 327, 17.12.2019, pp. 99–107).

See consolidated version.

last update 17.05.2022