p. finaldi russo, g. guazzarotti and v. nigro, ‘ first - time corporate bond issuers in italy ’, banca d ’ italia, questioni di economia e finanza, 269, 2015 ; n. branzoli and g. guazzarotti, ‘ il mercato dei private placement per il finanziamento delle imprese ’, banca d ’ italia, questioni di economia e finanza ( occasional papers ), 262, 2015. developing relations with investors whose needs are very different from those of a traditional bank. all this is already within the reach of many mediumsized and large firms. this needs to extend to other companies too. institutional investors on the supply side, the first requirement of a thriving economy is to have a large number of active institutional investors : insurance companies, pension funds and other asset management entities involved in managing savings, which facilitate the flow of resources to innovative firms with high growth potential. in italy, the share of managed assets in households ’ total financial assets remains below the average for euro - area and english - speaking countries, despite strong growth in recent years ( in 2016 the total volume managed by institutional investors exceeded €1. 4 trillion and reached 85 per cent as a proportion of gdp ). more importantly, only a small share of these resources currently flow into the productive system. institutional investors hold just over one tenth of corporate bonds. in france, where the capital market is more developed, the share is over 40 per cent. 8 and that is in a context where total bond issues are at much lower levels than in italy. investors are certainly deterred by the limited development of pension funds and of intermediaries specializing in the placement and underwriting of corporate debt instruments, such as private debt funds, but there are also more wide - ranging reasons. let ’ s look at the insurance sector. insurers ’ investments to cover technical reserves focus on italian government securities, with little appetite for corporate bonds, much less equity. so far, insurance companies have m. accornero, p. finaldi russo, g. guazzarotti and v. nigro, ‘ the italian corporate bond market : missing investors or missing issuers? ’, banca d ’ italia, forthcoming. shown limited interest in the legislative and regulatory changes made to encourage investment in productive firms. prudential regulation on own funds obviously influences this approach. as we know,

calculated as the ratio between debt and debt plus net capital ). this reduction has affected firms of all sizes. in large firms ( those with more than 250 employees or with assets or turnover above €50 million ) this was mostly due to an increase in net capital, thanks to the positive effects of the recovery, which has favoured both higher market value for capital and the reinvestment of profits in firms. the allowance for corporate equity ( ace ), a measure enacted in 2012 which finally gave risk capital and debt the same tax treatment, also played a part. 2 however, the weakening of this measure as of this year will greatly limit its effects going forward. leverage has decreased in the other size classes too, though mainly due to the decline in bank loans : many small firms, already greatly in debt, have left the market or found it difficult to renew their credit lines. see i. visco, address by the governor of the bank of italy, italian banking association, annual meeting, rome, 12 july 2017. on the effects of the ace, see n. branzoli and a. caiumi, ‘ tax incentives and financial stability ’, banca d ’ italia, questioni di economia e finanza ( occasional papers ), forthcoming. recourse to the stock market has increased, especially in recent years. between 2014 and 2016 over 60 firms were quoted on the stock exchange, mainly on the alternative investment market ( aim ), a market segment with lower entry costs. in the same period, investments by private equity and venture capital firms in risk capital returned to pre - crisis levels of around €5 billion a year. despite the positive contribution from various public schemes, such as the italian investment fund and the business register for innovative start - ups, the share of investment in start - ups or in high - growth firms is still modest by international standards : in 2016 it stood at 15 per cent, against 23 per cent in germany and almost 40 per cent in france and spain. during the crisis, not only did the relative weight of debt and risk capital change, but so did the composition of firms ’ sources of debt, with a growth in bonds to the detriment of bank lending. since 2011 the share of bonds in overall financial debt has risen by 5 percentage points to 12 per cent ; that of loans granted by italian banks has fallen in equal measure to 61 per cent. during the most acute phases of the credit restriction triggered by the global financial crisis and then by