62018TJ0406_RES
Case T‑406/18
de Volksbank NV
v
Single Resolution Board (SRB)
Judgment of the General Court (Tenth Chamber, Extended Composition) of 12 February 2025
(Economic and Monetary Union – Banking Union – Single Resolution Mechanism for credit institutions and certain investment firms (SRM) – Single Resolution Fund (SRF) – Decision of the SRB on the calculation of the ex ante contributions for the 2018 contribution period – Articles 4, 14 and 16 of Delegated Regulation (EU) 2015/63 – Principle of good administration)
Economic and monetary policy – Economic policy – Single Resolution Mechanism for credit institutions and certain investment firms – Ex ante contributions to the Single Resolution Fund (SRF) – Calculation of those contributions based on the latest approved and certified annual financial statements on 31 December of the year preceding the contribution period – Financial statements corresponding to an accounting year which began in the penultimate year preceding that period and was closed in the year preceding that same period
(Commission Regulation 2015/63, Arts 12(2) and 14(1) to (3))
(see paragraphs 65-67)
Economic and monetary policy – Economic policy – Single Resolution Mechanism for credit institutions and certain investment firms – Ex ante contributions to the Single Resolution Fund (SRF) – Determination of the contribution of an institution – Methodology for determining the net liabilities – Merger between credit institutions during the contribution period – Significant increase in liabilities resulting from that merger – Use of data relating to different points in time of the contribution period – Principle of good administration – Obligation for the Single Resolution Board (SRB) to examine carefully and impartially all the relevant aspects for the purpose of calculating the contributions – Failure to take into account those relevant aspects – Breach of the principle of good administration – Not permissible
(European Parliament and Council Regulation No 806/2014, Art. 70(2), second subpara., point (a); Commission Regulation 2015/63, Arts 4(1) and 14(1); European Parliament and Council Directive 2014/59, Art. 103(2))
(see paragraphs 72, 85-87, 90-92)
Economic and monetary policy – Economic policy – Single Resolution Mechanism for credit institutions and certain investment firms – Ex ante contributions to the Single Resolution Fund (SRF) – Determination of the ex ante contribution – Relevant point in time for determining the total liabilities of a credit institution – Discretion of the Single Resolution Board (SRB) – Limits – Principle of good administration – Obligation to reflect precisely the size of the institutions concerned and the associated risk according to their liabilities
(Charter of Fundamental Rights of the European Union, Art. 41; European Parliament and Council Regulation No 806/2014, Art. 70(2), second subpara., point (a); Commission Regulation 2015/63, Arts 4(1) and 14(1); European Parliament and Council Directive 2014/59, Art. 103(2))
(see paragraphs 73, 74, 77, 78, 80-83)
Résumé
Hearing an action for annulment, which it upholds, the General Court rules, for the first time, on the methodology used by the Single Resolution Board (SRB) to calculate the ex ante contributions of institutions subject to that system and the components of that calculation in the event of a merger between two credit institutions.
The applicant, de Volksbank NV, formerly SNS Bank NV, is a credit institution established in the Netherlands.
In 2016, the group comprising SNS Bank and its two subsidiaries was restructured, as a result of which, on 31 December 2016, those two subsidiaries were absorbed by SNS Bank; on 1 January 2017, SNS Bank was renamed de Volksbank (‘the 2016 merger’). That absorption led to the withdrawal of the banking authorisations of those two subsidiaries, leaving the applicant, in 2017, as the only institution falling within the scope of Regulation No 806/2014. (
1
)
By decision of 12 April 2018, (
2
) the SRB determined the ex ante contributions to the SRF (‘the ex ante contributions’), (
3
) for 2018, of the institutions covered by the provisions of that regulation, which included the applicant. By letter of 23 April 2018, De Nederlandsche Bank NV (DNB, Bank of the Netherlands), in its capacity as the national resolution authority, ordered the applicant to pay its ex ante contribution for 2018, as determined by the SRB.
On 8 August 2022, the SRB adopted the contested decision, (
4
) by which it withdrew and replaced the initial decision in respect of certain institutions, including the applicant, in order to remedy the failure to state reasons for the latter decision, in the light of various decisions of the Court of Justice. (
5
) In order to calculate the applicant’s net liabilities and, accordingly, its basic annual contribution, the SRB used, first, the amount of the applicant’s total liabilities as at 31 December 2016, thereby relying on data subsequent to the 2016 merger, and, second, the average amount of its covered deposits, calculated quarterly, in 2016, that amount therefore being determined on the basis of data which largely pre-dated that merger (‘the methodology used by the SRB’). It is in that context that, in the light of the methodology used by the SRB, the applicant, in support of its action for annulment of the contested decision, complained in particular that the SRB had used data relating to different points in time for the purpose of calculating its ex ante contribution.
Findings of the Court
As a preliminary point, the General Court recalls that it is apparent from Article 4(1) of Delegated Regulation 2015/63 (
6
) that it is for the SRB to determine the ex ante contribution of each institution on the basis of information provided by that institution and, specifically, by means of the latest approved annual financial statements which were available, at the latest, on 31 December of the year preceding the contribution period (‘year N-1’), provided together with the opinion submitted by the statutory auditor or audit firm. Moreover, it states that, in view of the time required in order to finalise such financial statements, that information relates, as a general rule, to the penultimate year preceding the contribution period concerned or, in exceptional circumstances, to an accounting year which began during that penultimate year and was closed during year N-1 (those two periods being referred to as ‘reference year N-2’).
As regards the SRB’s use of data relating to different points in time for the purpose of calculating the applicant’s net liabilities and therefore its ex ante contribution, the Court examines whether, when the SRB takes into account the average amount of covered deposits, calculated quarterly, for reference year N-2 with a view to calculating the net liabilities, it may at the same time take into account, for the purposes of that calculation, the amount of total liabilities, as it stands at the end of reference year N-2, and not the average amount of total liabilities calculated quarterly, which also includes the amount of covered deposits.
In that regard, the Court observes that neither Delegated Regulation 2015/63 nor Directive 2014/59 nor Regulation No 806/2014 contains specific requirements concerning the SRB’s obligation, in determining the net liabilities, to take into account the amount of total liabilities at the end of reference year N-2 or their average amount during that year. Consequently, Delegated Regulation 2015/63 (
7
) confers discretion on the SRB as regards the relevant point in time for determining the amount of total liabilities for the purpose of calculating the net liabilities.
However, in the exercise of such discretion, the Court states, first, that the principle of good administration (
8
) imposes on the institutions and bodies of the European Union the duty to examine carefully and impartially all the relevant aspects of the individual case. Second, with specific regard to the matter concerned, the basic annual contribution, as provided for in Directive 2014/59 and Regulation No 806/2014, (
9
) is based on a pro rata amount of the net liabilities of each institution with respect to the net liabilities of the other institutions. Such a ratio reflects the general scheme of the ex ante contribution system, whereby the basic annual contribution must above all reflect the size of each institution according to its liabilities. (
10
)
Thus, the size of an institution represents a first indicator of the risk posed by it, since the larger an institution is, the more likely it is that, in the case of distress, the SRB would consider it in the public interest to resolve that institution and to make use of the SRF to ensure an effective application of the resolution tools. It is in that context that the Court has previously held that the basic annual contribution must reflect the size of the institutions in order to ensure that adequate financial resources are provided for the Single Resolution Mechanism for the purposes of the efficient application of the resolution tools. In those circumstances, it is for the SRB to calculate the basic annual contributions in such a way that reflects, in a sufficiently precise manner, the size of the institutions concerned and the associated risk according to their liabilities, so that the institutions with significant liabilities pay higher ex ante contributions than the institutions with more limited liabilities – subject to the adjustment of those contributions in the light of the relevant risk indicators – and the institutions are encouraged to adopt less risky methods of operation by reducing, inter alia, the amount of their net liabilities.
Although the methodology used by the SRB may, as a general rule, reflect, in a sufficiently precise manner, the size of the institutions concerned, the situation may be different in certain specific cases where the total liabilities and covered deposits of a given institution undergo a significant change in the course of reference year N-2, going beyond the normal fluctuations of such liabilities during the year. Such a change may result, inter alia, from an alteration in the structure of that institution, such as that produced following a merger or absorption. When confronted with such a specific situation, it follows from the principle of good administration that the SRB is required to examine carefully and impartially all the relevant aspects of the individual case in the exercise of its discretion.
Consequently, where an institution submits to the SRB specific, quantified and verifiable data, from which it is apparent that, as a result of a substantial alteration in its structure in the course of reference year N-2, its total liabilities and the amount of its covered deposits underwent a significant change, with the result that the methodology for calculating the net liabilities no longer reflects its size in a sufficiently precise manner, it is for the SRB to take such aspects into account in order to ensure that the calculation of the net liabilities of the institution concerned complies with the requirements referred to previously.
In the present case, the Court observes, first of all, that the effect of the 2016 merger between the applicant and the absorbed subsidiaries was that, on 31 December 2016, the amount of the applicant’s total liabilities increased significantly, since it included – in contrast to the first three quarters of 2016 – the amounts of the total liabilities and covered deposits of its former subsidiaries.
Next, in order to calculate the applicant’s net liabilities and its basic annual contribution, the SRB used the amount of total liabilities on the basis of the data as at 31 December 2016, whereas, in respect of the amount of covered deposits subtracted from the amount of total liabilities, it took into account the average amount of the applicant’s covered deposits, calculated quarterly, in 2016.
As regards the covered deposits that were subtracted from the amount of total liabilities in the context of calculating the applicant’s net liabilities, the methodology used by the SRB took the 2016 merger into account only partially. By contrast, as regards the determination of the amount of the applicant’s total liabilities, the SRB relied solely on the statement of its total liabilities as at 31 December 2016, that is to say, on the amount resulting from the 2016 merger. It therefore did not take into account the amounts of the applicant’s total liabilities at the end of the first three quarters of 2016, which did not include the total liabilities of the absorbed subsidiaries.
It follows from those factors that the calculation of its total liabilities – the first component of the calculation of the net liabilities – was based entirely on the applicant’s situation following the 2016 merger, whereas the calculation of the amount of its covered deposits – the second component of that process – which then had to be subtracted from the total liabilities, was based to a very large extent on the applicant’s situation prior to that merger. Therefore, given the extent to which all those liabilities were modified as a result of the 2016 merger, such a calculation of the net liabilities did not reflect, in a sufficiently precise manner, the size of the applicant and, accordingly, the associated risk. Thus, the SRB did not take into account all the relevant aspects of the individual case in the exercise of its discretion, in order to ensure that the calculation of the applicant’s net liabilities complied with the requirements referred to previously.
Consequently, the Court holds that the SRB exercised its discretion, in the context of calculating the applicant’s basic annual contribution, in a manner that infringes Article 4(1) of Delegated Regulation 2015/63 (
11
) and the principle of good administration, and annuls the contested decision to the extent that it concerns the applicant.
(
1
)	Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and amending Regulation (EU) No 1093/2010 (OJ 2014 L 225, p. 1).
(
2
)	Decision SRB/ES/SRF/2018/03 of the SRB of 12 April 2018 on the calculation of the 2018 ex ante contributions to the Single Resolution Fund (SRF) (‘the initial decision’).
(
3
)	In accordance with Article 70(2) of Regulation No 806/2014.
(
4
)	Decision SRB/ES/2022/46 of the SRB of 8 August 2022 withdrawing Decision SRB/ES/SRF/2018/03 of the SRB of 12 April 2018 on the 2018 ex ante contributions to the SRF (‘the contested decision’).
(
5
)	Judgment of 15 July 2021, Commission v Landesbank Baden-Württemberg and SRB (C‑584/20 P and C‑621/20 P, EU:C:2021:601), and orders of 3 March 2022, SRB v Hypo Vorarlberg Bank (C‑663/20 P, not published, EU:C:2022:162) and SRB v Portigon and Commission (C‑664/20 P, not published, EU:C:2022:161).
(
6
)	Commission Delegated Regulation (EU) 2015/63 of 21 October 2014 supplementing Directive 2014/59/EU of the European Parliament and of the Council with regard to ex ante contributions to resolution financing arrangements (OJ 2015 L 11, p. 44).
(
7
)	Specifically, Article 4(1) and Article 14(1) of Delegated Regulation 2015/63.
(
8
)	As enshrined in Article 41 of the Charter of Fundamental Rights of the European Union.
(
9
)	Article 103(2) of Directive 2014/59 and point (a) of the second subparagraph of Article 70(2) of Regulation No 806/2014.
(
10
)	As is apparent from the travaux préparatoires relating to Directive 2014/59 and from recital 5 of Delegated Regulation 2015/63.
(
11
)	As interpreted in accordance with Article 103(2) of Directive 2014/59 and point (a) of the second subparagraph of Article 70(2) of Regulation No 806/2014.