New challenges have emerged as a result of the significant increase in wholesale funding of financial intermediaries, the emergence of new institutions (some of them highly leveraged and to which banks are very much exposed) and the increasing transfer of risks previously concentrated in the banking sector to other agents, such as insurance companies. A comprehensive framework for policy analysis is still lacking.
A number of proposals for specific macro-prudential measures have been put forward, following the objective-oriented approach. 15 But we need a broad framework for policy analysis and implementation. We have been working on this at the ECB for some time.