A threat to the stability of the euro area financial system is the rapidly growing influence of the market of private funds and other non-bank financial intermediaries (which are not as supervised as banks). For non-bank financial intermediaries, often referred to as “shadow banks” (shadow banks), owned assets worth 42.9 trillion euros in the third quarter of last year in the European Union. For comparison: traditional lenders – 38 trillion euros, according to data from the European Commission. The growth of the non-banking sector since the global financial crisis has been remarkable, and European Central Bank (ECB) supervisory board member Elizabete Makola in an interview Financial Times indicated that this has always been a concern of the ECB. This area operates outside the perimeter of banking supervision, and the opaque links between the industry and banks through repurchase agreements, lines of credit or derivatives raise concerns about systemic risks.
At the same time, the role of these market participants in the financial market is very large and without them borrowing, lending, buying and selling financial instruments in the financial market would be significantly more difficult, longer and at more volatile prices. in the Bank of Latvia For days points out that in this way “shadow banks” also indirectly affect the population of Latvia, the state and companies s
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2024-08-23 21:01:27