TY - RPRT A1 - Mack, Sebastian T1 - Handle with care – How Europe can reap the benefits of securitisation N2 - Provided it is sufficiently regulated, securitisation can help to fund the economy and share risks within the monetary union. Securitisation combines the advantages of banks in lending and of financial markets in financing. However, a lack of standardisation and legal harmonisation currently prevents the EU from reaping the benefits of this instrument. Weakening the prudential framework will not create a truly European market but may pose new risks to financial stability. Instead, this Policy Brief argues that to scale up securitisation, overcoming the fragmentation in national contract and insolvency laws in the longer term will be key. In the meantime, the European Commission should cut unnecessary red tape and establish an EU-wide standardised securitisation product tailored to an asset class that shows sustainable growth potential. Renovation loans are a promising option. Y1 - 2024 UR - https://www.delorscentre.eu/en/publications/detail/publication/handle-with-care-securitisation ER - TY - RPRT A1 - Mack, Sebastian T1 - Out of the shadow: A macro-prudential framework for NBFI in the EU N2 - Whereas market financing is becoming increasingly important, structural vulnerabilities in the shadow banking sector remain unaddressed. To ensure that capital markets are a source of economic prosperity rather than financial instability, the European Commission in its new term should strengthen the macro-prudential framework for non-bank financial intermediation (NBFI). As developing and integrating Europe’s capital markets can help to provide innovative companies with risk capital, non-systemic NBFI entities should not be overburdened with micro-prudential regulation. However, the build-up of systemic risks in the NBFI sector must be addressed before they reach a dangerous level and central banks are forced to come to the rescue. This paper makes recommendations for tackling the structural vulnerabilities posed by NBFIs and their potentially dangerous ties with banks and the broader economy. Y1 - 2024 UR - https://www.delorscentre.eu/en/publications/detail/publication/a-macro-prudential-framework-for-nbfi-in-the-eu ER - TY - RPRT A1 - Mack, Sebastian T1 - Europe ventures forward: Getting the scaleup of cleantech right N2 - Public interventions that help European startups to scale up their businesses have so far focused mainly on establishing a functioning market for venture capital (VC) and making it attractive to private investors. However, VC funding in Europe remains a fraction of what is required, still relies heavily on the public purse and fails to channel resources into strategic green sectors. Changing this requires three measures. First, the EU should enable institutional investors to invest independently in VC. Second, the European Investment Fund should strengthen the sustainability impact of its support for VCs. And third, the European Investment Bank should expand its direct investments in cleantech scaleups that are too risky for private investors. Y1 - 2024 UR - https://www.delorscentre.eu/en/publications/detail/publication/venture-capital-getting-the-scaleup-of-cleantech-right ER - TY - RPRT A1 - Mack, Sebastian T1 - Get your act together – The EU must push ahead with banking union to boost confidence in its banking system N2 - EU banks have so far weathered the storm caused by the pandemic, the war in Ukraine and sharp interest rate hikes. However, the failure of Credit Suisse and three US tech banks underlines how quickly investor and creditor trust can erode, prompting regulators to intervene and governments to provide public support. While swift and decisive action in the US and Switzerland prevented a systemic bank crisis, the EU will struggle to preserve financial stability if things go badly wrong. To boost confidence in its banking system, it is therefore high time for the EU to push ahead with banking union. To get its act together, the EU should 1) improve banks’ resilience by adopting strict prudential regulation instead of creating new vulnerabilities, 2) make the crisis management framework more credible to ensure that banks can fail without using taxpayers’ money, and 3) put in place European backstops to bank resolution and deposit insurance to withstand a systemic crisis. Y1 - 2023 UR - https://www.delorscentre.eu/en/publications/banking-union-boost-confidence ER -