This event is the launch of the final report of the European Capital Markets Expert Group (ECMEG), titled “Europe’s untapped capital market: rethinking integration after the great financial crisis” The report launch is organised by the Brevan Howard Centre for Financial Analysis at Imperial College Business School. The event will be held at the Mandarin Oriental Knightsbridge London, please use the Ballroom entrance to access the event.
Confirmed Panel Members:
- Diego Valiante, Head of Research at ECMI and Head of the Financial Markets and Institutions research unit at CEPS
- Franklin Allen, Executive Director, Brevan Howard Centre, Imperial College Business School
- David Miles CBE, Professor of Financial Economics at Imperial College Business School
- Xavier Rolet, Chief Executive, London Stock Exchange Group
- Angus Armstrong, Director of Macroeconomics, National Institute for Economic and Social Research
In the aftermath of the great financial crisis, financial market integration can help the functioning of Europe’s financial system by facilitating the absorption of asymmetric shocks via private risk sharing. Ample evidence shows that the lack of cross-sectional risk diversification, i.e. limited cross-border banking and capital markets activities, is a significant contribution to the fast retrenchment of capital flows within national boundaries. Europe’s capital markets are poorly functioning and are underdeveloped. Governments’ and financial institutions’ bond issuance are an exception, but their activism is mostly a result of the financial difficulties of recent years. To fix this, an EU-wide action to promote competition among national capital markets could free up to €1.8 trillion in cash and deposits to invest in more profitable and riskier projects to create growth and jobs.
This report is the result of a yearlong discussion with a group of academics and industry experts to provide a long-term contribution to the capital markets union project. It identifies 36 cross-border barriers to capital markets integration and provides an organic plan to rethink EU financial integration with a set of 33 policy recommendations to improve the key components of a capital market transaction: price discovery, execution and enforcement.