The European Central Bank says it will charge eurozone banks 260 million euros ($354.5 million) a year when it takes over regulatory responsibilities in early November. The ECB will surpervise eurozone banks under the Single Supervisory Mechanism, and published the budget as part of its draft regulation on Tuesday.

Banks will be charged according to their size. Most of the larger banks which are directly supervised on a daily basis will pay between 700,000 and two million euros. The 5,800 smaller banks, to be supervised indirectly, will on average pay between 2,000 and 7,000 a year.

Financial babysitters

Slightly more than half of the costs are for the salaries of about 800 expert financial babysitters to staff the ECB's new supervisory division. The rest are for operating costs and office space in Frankfurt.

Banks have expressed concern about rising costs and increasing regulation in the eurozone. But the ECB supervisory budget published Tuesday is a drop in the bucket compared to the 55-billion-euro Single Resolution Fund which eurozone banks have to finance between 2016 and 2024.

That fund is supposed to cover the costs of major bank failures, so that taxpayers are not required to provide bailouts in the future. This backstop fund and the ECB's Single Supervisory Mechanism are the cornerstones of the envisaged European banking union.

The union is supposed to restore confidence in eurozone banks after a string of major bank failures throughout the euro area, and to safeguard the survival of the single currency.

kpc/hg (dpa, afp)