Unlike banks, whose social function is to transform risk and maturity, CCPs are not in the business of taking risk directly but of pooling risk. 1  See Adrian, T., and Shin, H.S., “Liquidity and financial contagion”, Financial Stability Review, Banque de France, February 2008.
Financial systems need to have a broad array of instruments and markets and to provide a sufficient range of services if they are to be efficient and flexible and resilient enough to continue to function effectively in the face of major economic changes. On the topic of institutional governance, deficiencies in management and control have been common elements in banking and other financial crises.