4  BIS Review 64/2006  European bond and equity markets in terms of additional real GDP growth amount to around 1% over a ten-year period. Thanks to greater financial integration, economic agents can invest more easily in any part of the euro area and thereby spread the risk of potential local shocks having an impact on income and consumption.
Establishing numerical floors at around current levels could prevent the return of a less prudent set of practices as memories of the crisis fade. A second approach would be to set haircuts for a given asset class based on asset price volatility or haircut levels observed during times of stress or long-term periods that include times of stress.