Additionally, Hartmann highlighted that EU financial markets still suffer from several shortcomings. To my mind, the most obvious are risk capital markets, which are still small and represent bottlenecks in the areas of start-up financing (as highlighted by Marco Da Rin and Luísa Farinha in this morning’s session), and the limited use of securitisation, which hampers risk allocation and unnecessarily binds banks’ capital. 4.
Regulation, financial systems and growth  Once we acknowledge that both financial integration and financial modernisation still fall short of our expectations, the essential question is: Is there a need for structural reforms of the EU financial system? Or will markets be able to cope with the situation on their own?