It was also observed that nearly one third of the newly licensed UCBs became financially unsound within a short period.
It would benefit, in various ways, financial stability, access to finance and entrepreneurship. In particular for equity risk capital, which is critical for innovative young firms, market fragmentation in Europe creates a self-fulfilling brake on progress. Venture capital firms do not have a large enough deal flow to cover the majority of investments that will fail, meaning fewer investments are made.