We chose not to set aside any risk provisions in this regard this year, but we are aware that the risk factor will become significantly more important in the future. All in all, risk provisioning was reduced by € billion to € billion. 8.
As Charles Goodhart forcefully argued, prudential policy faces a “boundary problem”: …effective regulation can penalize financial intermediaries within the regulated sector compared to those just outside, leading to substitution flows towards the unregulated.18 For example, when it comes to what we now call non-bank financial intermediation (formerly known as shadow banking) the growth of total assets in recent years has been higher than in traditional banking.