It is well understood that as a consequence of the demise of SIVs, the investor base for asset-backed securities is substantially narrower than prior to the crisis. This is particularly the case in offshore markets. As some of these investors relied on various forms of excessive leverage to be profitable, they are not likely to return.
With respect to the absolute size of the short-term debt securities market, I would like to emphasise the Short-Term European Paper (STEP) initiative. The STEP initiative promotes the development of a pan-European short-term paper market through market players’ voluntary compliance with a core set of standards encompassed in the STEP Market Convention, which was signed in June 2006.