For instance, securitisation could be made more transparent, leading to the availability of better, more accurate information on the value of underlying assets – particularly loans. Improving the infrastructure used by issuers and investors to exchange information on complex financial products would increase transparency and foster market innovation, while reducing systemic risk.
Without such initiatives, important market segments could fail to recover from the severe decline in activity caused by the current crisis. Such markets are important in allowing financial institutions to secure asset- based funding, expand lending and better distribute risk. They contribute to the efficiency of the economic system, and so a failure to revive them would entail considerable social costs. 6.