1/6  BIS - Central bankers' speeches  Besides pricing and supporting, our governments have regulatory tools at hand. Through regulation, they could for example boost the private financing of innovations by promoting the market for equity finance. Equity financing is typically more conducive to innovation than debt financing.
Creating a genuine regime change, both in the system of supervision and resolution and in its application, could therefore have a powerful effect for Europe. In the near term, it could help accelerate the clean-up of banks’ balance sheets and thus restart bank lending. In the medium term, it could help encourage the development of genuinely European banks.