This movement was particularly important in Italy, France and Germany, where sales represented almost three-quarters of the total amount. The change in ownership has paved the way for corporate strategies benefiting from an open access to financial markets. –  Another force at work in Europe is deregulation. The change is particularly noticeable in several key sectors such as telecommunications, transportation, the power supply industry and, of course, the financial sector. This movement has prompted a rapid response from regulatory bodies to monitor the introduction of market rules and ensure the appropriate functioning of fair competition throughout the entire European Union. Today, this institutional framework appears quite appropriate against a background of in-depth restructuring and numerous mergers and acquisitions all across Europe. –  Moreover, the liberalization required for the single market endeavor has been accompanied by an increasing need for transparency and accountability, which has brought substantial changes in corporate practices. More detailed rules of disclosure for financial information and competitive offers for public procurement programs have been implemented throughout a large part of Europe. This phenomenon has enhanced the overall efficiency of the European market economy. A second series of reforms has resulted in increased flexibility in the labor market During the past two years, employment has grown faster in Europe than in the United States. There has been strong job creation, particularly in the new economy, as can be seen in the remarkable  1  BIS Review 52/2000  increase in employment in the IT companies listed on the “New market”.

First, being capital costly, the ability to sustain a given level of credit supply with a lower volume of capital enables the banking sector to reduce the costs of financing for borrowers and favours financial development, which is ultimately associated with economic growth. Moreover, securitisation may be seen as representing a step towards more complete credit markets, thereby contributing to enhancing the efficiency of the economic system. 3  See ECB (2007), Structural Issues Report on “Corporate finance in the euro area”, May. 4  Funding liquidity refers to the ability of a bank to: (1) convert its assets into cash by disposing of them or borrowing against their value in order to meet expected and unexpected obligations, or (2) to issue liabilities in order to raise funds. 5  According to some tentative empirical evidence, increasing securitisation may diminish the impact of monetary policy impulses on banks’ loans supply via the so-called “bank lending channel”, although the effect of securitisation seems to depend on the economic cycle and bank risk (see Altunbas, Y., Gambacorta, L. and D. Marqués Ibáñez (2007), “Securitisation and the bank lending channel”, ECB Working Paper 838. 2  BIS Review 68/2008  In addition, the securitisation of loans in principle could reduce a secular source of vulnerability of the economies, by taking risk concentrations associated with loan portfolios away from the balance sheets of the banking sector and spreading them more broadly across other sectors.