Public investment will provide a spark, but we need a financial system that is financing climate-friendly investment to keep the engine running. Fostering such a sustainability-minded financial system is an increasingly important topic for central banks. One of the strategic goals of the Bank of Lithuania is management of climate related risks.
Second was the problem of credit intermediation partly or wholly outside the limits of the traditional banking system. This so-called shadow banking system involved not only sizeable commercial and investment banks, but also a host of smaller firms active across a range of markets and a global community of institutional investors.