main challenge will involve maintaining a level playing field for all financial system participants, so that similar activities posing similar are subject to a comparable level of regulation. as the supervisor of banks and guarantor of financial stability, the banco de espana also faces very important and specific challenges as a result of disintermediation. in this new environment, the relative importance of the main risks to financial stability will foreseeably change with an increase of those linked to market risk. as a result, the supervision and analysis of the financial risks arising outside the banking system and of the interconnections between banks and other financial system participants will become more important. these interrelations will not only take the form of cross - balance sheet or income statement positions ; similarities between the portfolios of different types of participants may also mean that shocks initially affecting one institution or a group of institutions may ultimately have repercussions for all other financial market participants. in this respect, it should be borne in mind that the banco de espana is responsible for activating and deactivating certain macroprudential tools introduced under legislation to mitigate systemic risk in the financial sector. most of these instruments are applied almost exclusively to banks. 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

expected that this programme will continue to be conducive to the issuance of corporate debt. among the more permanent factors behind the rise in capital markets in europe are, firstly, the new international banking regulations in response to the crisis. true, the new regulatory requirements to improve banks ’ resilience to adverse shocks contribute to strengthening financial stability. but they might also hamper banks ’ ability to compete in the intermediation of some financial flows. 3 / 7 secondly, the influence of the alternative fixed - income and equity markets is worth highlighting. the launch of these markets, geared to luring medium - sized firms, is also contributing to the development of the capital markets. in particular, in spain we have witnessed the development of the alternative fixed - income market marf. that said, their size is still small in most european countries. in the future, this trend towards the greater development of capital markets might continue if progress is made on the european project to create a capital markets union, as i shall later discuss. a further factor pointing in this same direction is the potential increase in long - term saving associated with population ageing. the reason is that, for this investment horizon, capital markets may be a comparatively more attractive option than in the case of short - term saving. moreover, technological progress might prompt an increase in the activity of new non - bank competitors with innovative technologies. so far, market penetration by this type of player in the credit - supply business is limited in most european countries. initiatives like the regulatory sandbox currently being designed in spain, have the objective of promoting the emergence of these type of players. these controlled test environments aim to provide, with all due security measures for participants and the system as a whole, a nimble framework that provides for the viability testing of the new business models based on new technologies. they will also enable the supervisory community to gain knowledge on how new business models and technologies function and the new risks associated with them. in turn, this in depth knowledge will allow supervisors to fully exploit the proportionality principle embedded in regulations for those viable projects that might finally exit the test environment. because we should not forget that such test environment should have a temporary nature. hence, for those projects that prove viable, the principle of same regulation for similar activities and risks should prevail. in any event, it is currently difficult to foretell how the development of these disruptive technological players will evolve in the future. like any process of change, financial