By being inclusive in their lending and investing, banks help their local communities to thrive, which in turn benefits their core business. The recognition of this mutually beneficial relationship between banks and their local communities is one of the core strengths of the CRA.
Altogether, only around 40% of a given shock is absorbed before it can affect consumption. 11 Increasing the share of capital markets and integrating them across borders would therefore help improve risk sharing in Europe and also protect monetary policy by containing economic divergence.