The Single Supervisory Mechanism (SSM) was launched on 4 November 2014. Since then, the European Central Bank (ECB) has been responsible for supervising the significant banks/banking groups in Germany. A bank or banking group is considered significant if the total value of its assets amounts to at least €30 billion (or 20% of national gross domestic product) or if it is one of the three largest credit institutions in the respective participating member state.

Joint supervisory teams (JSTs) carry out the supervision of significant banks. These JSTs consist of staff from the ECB and the national supervisory authorities, i.e., in Germany, staff from the Federal Financial Supervisory Authority (BaFin) and the Deutsche Bundesbank. There is a JST for every significant bank or banking group in the euro area.

The tried-and-tested cooperation between BaFin and the Bundesbank, which is governed in detail by Section 7 of the German Banking Act (Kreditwesengesetz), has been extended by analogy to include cooperation with the ECB (see Section 7 (1a) of the Banking Act). In this context, particular importance is attached to the work of the JSTs, in which BaFin and the Bundesbank work closely and harmoniously with the ECB and, where applicable, other involved national competent authorities in matters of direct supervision and decision-making.

The teamwork this requires makes constantly open communication and the timely exchange of information necessary within the JSTs. Ultimate decision-making power with regard to significant institutions lies with the ECB.

The supervision of the approximately 1,400 less significant banks in Germany continues to be carried out directly by BaFin and the Bundesbank, while the ECB exercises indirect supervision, e.g. by laying down common guidelines on supervisory practices.