Total annual fees

The ECB levies an annual supervisory fee on all supervised banks to cover its costs in relation to banking supervision.

The total annual fees are based on the actual costs incurred, which are known following the closure of accounts for the year concerned. This means that the total amount of annual supervisory fees and the related ECB Decision will be published in March of the following year, at the same time as the ECB Annual Report on supervisory activities.

The fee for 2020 will be levied in 2021, and the invoicing will take place in the second quarter of 2021.

Chapter 6 of the ECB Annual Report on supervisory activities contains explanatory information on the actual expenditure and staffing for ECB supervisory tasks and describes the supervisory fees framework for that reporting period. It also contains the estimated amount of the annual costs for the next fee period.

ECB Annual Report on supervisory activities

What does the fee cover?

The total amount of annual supervisory fees covers the ECB’s expenditure in relation to its supervisory tasks for the relevant fee period, i.e. for that particular year. It consists of:

  • the total annual expenditure for the respective fee period
  • for the 2020 fee period only, the surplus from 2019 that will be refunded

The total amount of annual supervisory fees also includes:

  • any amounts received or refunded in the context of Article 7 of the ECB Regulation on supervisory fees relating to changes, such as authorisations of new supervised banks, withdrawals of authorisations, or changes in status from significant to less significant or vice versa
  • any fees related to previous fee periods that were not collectible
  • any interest payments received for late payment by the fee debtor

Total annual expenditure

The ECB’s annual expenditure for banking supervision consists primarily of costs directly related to its supervisory tasks:

  • directly supervising significant banks or banking groups: mainly costs associated with the Joint Supervisory Teams and on-site inspections
  • overseeing the supervision of less significant banks or banking groups: costs associated with oversight activities
  • performing horizontal tasks and specialised services: costs associated with activities such as the work of the Secretariat to the Supervisory Board, macroprudential tasks, statistical services and dedicated legal services

Each category of tasks also includes costs indirectly related to the ECB’s supervisory tasks, such as shared services provided by the ECB’s support business areas, including premises, human resources management and information technology (IT) services.

Surplus or deficit – applies to 2020 only

The total amount levied by the ECB must cover, but not exceed, the expenditure incurred by the ECB in the relevant fee period in relation to its supervisory tasks. Up to and including the 2019 fee period, the ECB levied a fee based on an estimate of costs for the fee period, resulting in a surplus or deficit between the amount collected and the actual expenditure incurred. The surplus or deficit from the previous year was deducted from or added to the total amount of annual supervisory fees for the following year. This means that, even though the fee for the 2020 fee period will be levied once actual costs are known, the surplus from the 2019 fee period will still need to be deducted from the 2020 fee.

At the end of 2019, the ECB’s expenditure for supervisory tasks stood at €537.0 million. This was 4% less than estimated, resulting in a surplus of €22.0 million compared with the expenditure estimated for that year. This will be deducted from the total amount to be levied for 2020.

From the 2021 fee period onwards, such a surplus or deficit will no longer exist.

Annual accounts of the ECB

Other adjustments

Each supervised bank or banking group must pay a fee for the year, or part of the year, in respect of which it is supervised. Where changes in a bank’s or banking group’s situation occur after the ECB has finalised the individual supervisory fee notice, the adjustment will be reflected in the total amount of annual supervisory fees for the next fee period. Changes in situation include authorisations of new supervised banks, withdrawals of authorisations, or changes in status from significant to less significant or vice versa.

Change in situation

The ECB takes all the necessary steps to collect supervisory fees from supervised banks and banking groups. Interest on late payments received and any amounts that were not collectible will be taken into account in determining the total amount of annual supervisory fees for the following year.

Other adjustments related to previous fee periods are not yet known and are therefore not taken into account in the 2020 annual supervisory fee estimate.

Estimated total annual supervisory fee for the 2020 fee period

For the 2020 fee period, the estimated total annual supervisory fee to be levied is approximately €581.7 million (see the table below). This is an increase of €5.7 million on the total annual supervisory fee levied in 2019, which amounted to €576.0 million.

In contrast to the deficit carried over for 2018, the 2019 estimate resulted in a surplus of €22.0 million to be carried over to the 2020 fee period. The 2020 fee period will be the last to be affected by a surplus or deficit from estimated amounts used for previous periods when levying the ECB supervisory fee.

 
Annual expenditure estimate 2020
Annual expenditure estimate 2019
Annual expenditure estimate 2018
Total supervisory fee* 581.7 576.0 474.8
Estimated expenditure 603.7 559.0 502.5
Surplus/deficit from previous year -22.0 15.3 -27.9
Other adjustments Not yet known 1.7 0.2

* All amounts are in EUR millions. Totals may not add up due to rounding.

The growth in expenditure is related to the direct supervision of significant banks. The outlook for banking supervision fees in 2020 can be found in Section 6.1 of the ECB Annual Report on supervisory activities 2019.

How much does each category of bank pay?

The amount that is recovered through annual supervisory fees depends on whether the supervised entity or banking group is significant (significant institution, SI) or less significant (less significant institution, LSI) and, therefore, the extent to which it is scrutinised by the ECB.

 
Fees for SIs 2020
Fees on LSIs 2020
Total
Total supervisory fee* 521.27 60.5 581.7
Annual expenditure estimate 544.3 59.4 603.7
Surplus/deficit carried forward -23.1 1.1 -22.0
Other adjustments Not yet known Not yet known Not yet known

* All amounts are in EUR millions. Totals may not add up due to rounding.