CMU will also help, as Isabel Schnabel emphasised recently, to accelerate the transition towards a carbonneutral economy, as the evidence suggests that stock markets are more effective than banks in financing the greening of our economy.13 However, like all forms of financial intermediation, market-based finance can contribute to a build-up of financial vulnerabilities.
Vulnerabilities linked to market-based finance include those related to liquidity mismatches and excessive leverage. Given the size of the sector domiciled here, we actively contribute to discussions through our role in the Eurosystem, the European System of Financial Supervision and we are also active at the global level through contributions to deliberations by IOSCO and the Financial Stability Board.