27 May 2014

ECB launches public consultation on draft ECB regulation on supervisory fees

The SSM has been established to contribute to the safety and soundness of the euro area banking system and to help restore confidence in the banking sector, through independent, integrated European supervision for all euro area and other participating Member States. It aims to increase financial stability and integration in Europe and harmonise supervisory practices, for the benefit of banks under its supervision.

The draft regulation sets out the arrangements under which the ECB will levy an annual supervisory fee for the expenditures incurred in relation to its new role, from November 2014 onwards.  It establishes the methodology for:

• determining the total amount of the annual supervisory fee;
• calculating the amount to be paid by each supervised bank or banking group;
• collecting the annual supervisory fee.

Under the EU Regulation governing the Single Supervisory Mechanism (SSM Regulation), the ECB is required to levy an annual supervisory fee on the directly and indirectly supervised banks in order to recover its expenditures for supervision, which are estimated at about €260 million for 2015.

The consultation opens today for a seven-week period, until 11 July 2014. The ECB will hold a public hearing on the consultation documents on 24 June 2014, at its premises in Frankfurt.

Press release

EBF

European banks fully support the additional role for the ECB as central European supervisor under the Single Supervisory Mechanism (SSM), the first pillar of Banking Union. The new mechanism, which also involves national competent authorities, should lead to significantly improved supervision for euro area banks and seeks to restore confidence in the European banking sector.

Banks are making important contributions to the safety of the banking sector including funding supervisory costs as well as contributing to higher deposit guarantee schemes and resolution funds.

The EBF believes supervisory costs need to be fair and equitable. Banks urge the ECB to avoid duplication of costs between the SSM and national competent authorities. The allocation of fees to supervisory expenditure should be made transparent. The EBF looks forward to studying the consultation in detail and plans to submit a more comprehensive response in due course.

Press release

Association of German Banks (Bankenverband)

Michael Kemmer commented: "Good supervision costs money. The private banks in Germany are ready and willing to pay their contribution to funding the ECB and ensuring effective banking supervision in the eurozone. We believe the draft regulation on supervisory fees unveiled today by the ECB goes in the right direction. It is right that all banks in the eurozone should pay a supervisory fee to the ECB since the ECB will be responsible for all banks. The banking industry in its entirety will benefit from the new supervision by the ECB and this is reflected in the draft. The level of the fee paid by each individual bank will be based on objective, graduated criteria and will depend on both the size and the risk profile of the institution. Under the draft?s proposals, the big banks supervised by the ECB directly will pay 85 per cent of the total cost."

Press release

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