Germany’s banking landscape features a wide variety of different institutions, each supervised according to their type and size as well as the nature and scope of the inherent risk. The German banking landscape includes around 1,400 credit institutions, most of which fall under the definition of “CRR credit institutions”. In addition, around 1,200 financial services institutions and investment firms and around 100 payment institutions and e-money institutions are supervised as well.

Ever since the Single Supervisory Mechanism (SSM) came into force in November 2014, CRR credit institutions have fallen within the supervisory perimeters of the SSM, as defined in the SSM Regulation, while competence for overseeing the other institutions remains a matter for national authorities.

The ECB is responsible for directly supervising significant institutions (SIs), a task which is performed by joint supervisory teams (JSTs). Supervisory decisions are taken by the SSM’s Supervisory Board and also require approval from the ECB’s Governing Council.

Direct and operational supervision of the less significant institutions (LSIs) is carried out by the responsible national authority respectively. The ECB does, however, perform an indirect oversight function for LSIs in order to ensure uniform high standards and consistency of banking supervision within the SSM.