Joachim Nagel: Remarks at the "Bell ringing ceremony"
Remarks by Dr Joachim Nagel, President of the Deutsche Bundesbank, at the "Bell
ringing ceremony" to celebrate the European Commission joining the European repo
market at Deutsche Börse/ EUREX , Frankfurt am Main, 7 October 2024.
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Ladies and gentlemen,
It is a great pleasure to be here today to celebrate the European Commission joining
the European repo market at Deutsche Börse/EUREX. This is a significant milestone,
and I am happy to share this moment with all of you.
The Bundesbank will act as a General Clearing Member for the Commission. Having
provided similar services to several other public entities for many years, the
Bundesbank brings experience to the table. With this robust track record, we are happy
to provide our services to the Commission. I can assure you that you are in good hands.
EUREX already supports a wide range of repo transactions and is a major player in
Europe's financial landscape. Since 2021, the Commission has been issuing bonds
under the temporary NextGenerationEU programme, and this will continue until 2028. In
total, bonds worth approximately €800 billion will ultimately be issued. The EU is
therefore set to become an important player in the euro bond market for some time to
come. The repo facility introduced today will significantly enhance liquidity in the
secondary market for these bonds.
Ladies and gentlemen, today's event not only highlights the attractiveness of Frankfurt
as a financial hub, it also helps strengthen it further. This is particularly important as
much investment will be needed in the areas of digitalisation and decarbonisation in the
future. Of course, bank loans will likely continue to play a vital role in financing these
investments. But there is also substantial potential for more financing through capital
markets.
As many of you probably already know, I have long been an advocate of greater
integration of European capital markets. I firmly believe that advancing the Capital
Markets Union is essential, particularly in the areas of securitisation, insolvency laws,
and venture capital.
A transparent and high-quality securitisation market would enable banks to transfer
parts of their loan portfolios to the capital market. This would relieve their balance
sheets and create scope for additional loans. An effective and harmonised insolvency
regime would facilitate cross-border investment and the reallocation of scarce
resources to innovative firms striving to build a digital and carbon-neutral future. Finally,
better access to venture capital would help young European firms turn innovative ideas
into marketable products.
For now, I look forward to implementing our newly established partnership and to the
benefits it will bring to our financial system.