later on. 8 moreover, bbms may affect specific groups, such as banks, borrowers or countries, even cerutti et al., 2017 ; eller et al., 2020. couaillier et al., 2021. the regulatory capital relief measures considered in the analysis include the reduction of the combined buffer requirement ( cbr ), as well as the frontloading of new rules on the composition of the pillar 2 requirement ( p2r ), allowing banks to partly use additional tier 1 and tier 2 ( instead of cet1 ) instruments to meet these requirements. in particular, credit volumes increased by 3. 1 per cent after the regulatory capital relief measures, while interest rates on loans to firms eased by 7 basis points. ampudia et al., 2021. see, for romania, neagu et al., 2015. this seems to have been the case with the uk financial policy committee ’ s decision in 2014 to recommend a loan - to - income ( lti ) flow limit calibrated to a level that would have no impact on mortgage lending in a central scenario, but would prevent a significant increase in lending at very high lti multiples ( bank of england, 2014 ; see also, for poland, łaszek et al. 2015 ). when there is no clear overall effect. these heterogeneous effects are mainly attributable to the introduction of differentiated ltv limits by category of borrowers. 9 while several papers investigating the effects of ltv or dsti caps use a multi - country framework, and policy dummies or macroprudential indices to operationalise the definition of macroprudential policy, 10 single - country studies provide a more focused analysis on the impact of these measures. for instance, both one paper on israel11 and one on sweden12 found that the introduction of an ltv limit did not reduce the number of borrowers accessing credit ; but it did encourage borrowers to borrow less and to buy cheaper and lower - quality houses. there is also some evidence of unintended consequences, such as spillovers ( banks shifting risk to other business areas ), and circumvention. for example, when ireland introduced ltv and lti limits in february 2015, banks appear to have increased their risk - taking in lending to companies and holdings of securities, two asset classes not targeted by the measure. 13 in spain, following a similar measure, appraisers appeared

is consistent with known cognitive bias, so as to empower the consumer to make such choices in full awareness. whatever your approach, the landscape is evolving rapidly. a growing body of experimental research is developing on the effectiveness of regulatory initiatives based on behavioural insights. at the frontier, a series of studies is flourishing on the physiological reaction of financial consumers to external stimulus ( neurofinance ). what will come out of that, and what one is to do with whatever the results might be, must be the subject of future reflection. for the framework of consumer protection to be effective, it needs more than regulation alone. it must be complemented with supervision, enforcement, and financial education. let me elaborate briefly on the approach of the bank of italy. based on the understanding that too much information is as potentially harmful as too little information, and that such “ information overload ” can lead consumers to take financial decisions that they will consider inappropriate in retrospect, the traditional regulatory approach based on a full disclosure regime has evolved. reflecting changes in the eu legal framework too, regulation of the most common products now provides for standardised pre - contractual information that makes key information adequately salient. the regulator plays a delicate role in selecting the most relevant information, based for instance on the size of the revenues from certain fees and tariffs, and finding ways to increase its visibility. one application of this concept is to require banks to disclose standardised cost indicators for the simplest forms of bank accounts and the most common types of consumer loans. thaler, r. h. and sunstein, c. r., “ libertarian paternalism. ” the american economic review, vol. 93, 2003, pp. 175 - 179. thaler, r. h. and sunstein, c. r., “ nudge : improving decisions about health, wealth and happiness. ” new haven and london : yale university press, 2008. again on the regulatory side, recognising that biases are always in action, and that financial services providers – including banks – may actively seek to exploit them, has led us to introduce – in compliance with the applicable eu legislation – certain business conduct requirements, aimed at increasing the overall fairness of contractual relationships. we abstain, however, from interfering directly with individual decisions of consumers or firms. a few examples of such requirements are : i ) provisions concerning the assessment of creditworthiness, to address overindebtedness ; ii ) product governance requirements, concerning the