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The global agenda
Derivatives markets are global markets; and they were at the root of the financial crisis. The G20 agreed that global markets needed strict regulation to make our financial system safer.
Many countries are now moving from designing rules on derivatives to implementing them, for instance in Europe, the USA, Asia and Canada. We face three challenges:
We need global solutions to meet these challenges, and we are making progress to avoid friction and duplication.
Wider regulatory reform, including Banking Union
Looking back on the last four years, I am proud of what has been achieved to regulate the financial sector better; return public finances to health; and improve the governance of the euro area. We implemented the G20 agenda so that every market, every player and every activity is well regulated and effectively supervised. We demanded that banks hold more and better capital, that they strengthen their risk governance and curtail the excesses of the past. We created new supervisory authorities to make sure banks, markets and insurance companies are supervised adequately and in a similar way across the EU.
And we are well on the way to creating a Banking Union which will ensure the integrity of the euro area and the stability of its banking system while securing the interests of the wider EU single market. I appreciate in particular that non-eurozone members fully supported the negotiations.
Long-term financing
To consolidate the growth that is slowly returning, the single market is vital; it must work efficiently. And access to finance is essential for all those who have projects and need financing to see them happen. Finance is also essential to meet Europe's massive long-term investment needs.
The European Commission put forward last week a series of ideas to stimulate new and different ways of providing long-term financing. This financing will have to come from a variety of sources in addition to the bank funding on which Europe relies so heavily:
One of the suggestions we have put forward is to revive sustainable securitisation markets, because we want to make it easier for small businesses to access capital markets and larger pools of investment. We want securitisation products to be part of the toolbox that will unlock additional sources of funding to the real economy, but only in ways that raise no financial stability concerns. The first step is to define criteria by which we can identify safe, high-quality securitisation structures and products.
Full speech