This could make it cheaper for large corporations to raise money directly in these markets than to borrow from banks. The privatisation of banks is another force for change. It is also argued that the deregulation of the financial sector will further erode the obstacles that deny new providers of financial products access to the market.
Demographic factors are also shaping the European banking industry. The widely held view thus appears to be that European banks are heading for turbulent times. The driving forces just mentioned will lead to intensified competition not only among banks but also between banks and other, new financial intermediaries. This is generally expected to increase the need for a restructuring of the banking sector.