And indeed, such measures have been used more actively in recent years.34 The exercise of these and other financial sector policies during the crisis, however, may have had a national bias, thus contributing to the fragmentation and deglobalisation of financial markets that we are currently witnessing.35 Global and European banks in particular have reduced their foreign exposures in the aftermath of the crisis.
While this may partly reflect a change in risk and return considerations, policies aimed at preserving domestic financial stability may have contributed.