As he explained it, “To improve the financing of our economy, we should further develop and integrate capital markets. This would cut the costs of raising capital, notable SMEs, and help reduce corporations’ high dependence on bank funding”. Last week, The European Commission launched the Action Plan on Building a Capital Markets Union (CMU). The Capital Markets Union is a good initiative.
The ECB and the Bank of England have already been active in some capital markets issues, especially reviving the EU market for a high-quality securitization. The CMU should help mobilise more capital in Europe and especially channel it to financing of the corporate sector.