The more recent stress came from the leveraged position of so-called liability-driven investment funds (LDI), ultimately requiring a commitment of £ worth of intervention by the Bank of England. The financial system in Ireland is heavily weighted towards the non-bank sector. The largest part of that sector is made up investment funds, money market funds and special purpose entities.
We have the third largest funds sector in the world. To give you a sense of scale, by the end of 2021, there were nearly 10,000 such entities, up from about 6,000 in 2016. In the same period, asset values of these entities increased from approximately € trillion to € trillion. I will return to the need for more regulation of non-banks later.