- Disappointing progress in euro area financial integration since start of monetary union
- Policies urgently needed to mobilize savings, develop euro area bond and equity markets
A better integrated euro area internal market for financial services is necessary to secure European economic and financial resilience, the European Central Bank (ECB)’s report on Financial Integration and Structure in the Euro Area shows. This is all the more crucial in the face of the growing need for investments to meet common challenges such as the green and digital transitions, security and aging populations.
The euro area has demonstrated resilience during crises, but progress in financial integration has been disappointing. Indicators of financial integration have declined significantly over the past two years, with no sizeable increases since the start of monetary union.
Policy action is now urgently needed to mobilize available savings, develop euro area bond and equity markets, and make these markets more attractive to foreign investors. Achieving a fully integrated financial services market also requires facilitating cross-border banking and harmonizing regulatory frameworks and disclosure requirements.
Finadium recently covered the regulatory and market views on advancing the Capital Markets Union: read the full article