However, so far, the implementation of these measures has been slow and incomplete. It is a far-reaching project requiring highly diverse measures, including most notably the creation of market infrastructure, the harmonisation of market regulation and supervision, and the strengthening of the European supervisory authorities. 6/7  There is also a need to move towards harmonising insolvency arrangements, both for banks and non-financial corporations, and to tackle aspects such as the bias in some countries’ tax systems towards debt as opposed to equity financing. Moreover, this project takes on particular importance in the context of the exit from the European Union of the United Kingdom, which currently plays a key role as a European financial centre. In connection with the Capital Markets Union, some initiatives have been adopted to provide financing for those segments with scant access to bank lending. One example is the innovation projects for which the promotion of venture capital funds is being considered. Measures have also been adopted to promote the use of simple, transparent and standardised securitisations in order to provide bank lending to small firms. These examples evidence the complementarities between bank markets and capital markets, and also how the Banking Union and the Capital Markets Union reinforce one another. Turning to equity markets, progress has been made to provide firms with access to these markets. Further, many studies have been undertaken to identify the obstacles to international investment. Yet, in order to equip the euro area with greater stability, resolute headway must also be made in European bank integration.

Thus, growing banking disintermediation might diminish the general effectiveness of such instruments, if other participants in the financial system, to which these tools were not applicable, were to engage in activities similar to those of banks. 5/7  To mitigate this risk, the forthcoming creation of a Spanish Macroprudential Authority will provide the appropriate forum in which all financial system supervisors may share their analysis of risks and coordinate the most suitable response, without leaving “gaps” that might restrict effectiveness Private risk mitigation measures in the Economic and Monetary Union In any event we should be mindful that, to ensure greater stability in European financial systems, it does not suffice to adopt measures at the national level; it is also necessary to push through a greater level of development and integration of European capital markets so that, in conjunction with the Banking Union, the risk-sharing and mitigation mechanisms at the level of the euro area as a whole are strengthened. In this connection, allow me to dwell on the importance of private risk mitigation measures. The crisis highlighted the scant power of these channels in the Economic and Monetary Union, compared with other monetary unions. It also became evident that these channels diminish, or even disappear, precisely when they are most needed. It is estimated that in the United States the cross-border ownership of capital across states enables 40% of the asymmetric shocks affecting a State to be diluted among the rest through private capital markets.