In this regard, the euro area is seriously lagging behind: equity capital amounted to only 68% of GDP at end-2016, compared with 128% in the United States. And yet, resources are abundant: the excess of savings relative to investment is around EUR 350 billion per year, which is more than 3% of GDP. It is therefore crucial for the euro area’s economy to better steer these savings towards productive investment across borders, notably by shoring up equity which is the key to an innovation economy. Start ups are well aware of this, but our European scale-ups, midcaps and SMEs also need greater access to equity leverage. The insurance sector has a key role to play since it is the largest institutional investor in the euro area, with total assets of close to EUR 7,800 billion in the second quarter of 2017. In practice, what is the way forward? A large part of the solution lies at the European level. The efforts so far are going in the right direction, but work should now be accelerated with what I call a “Financing Union for Investment and Innovation”. This Financing Union is the microeconomic accelerator that we need to make concrete progress towards a genuine Economic Union in the euro area.
Insurance supervision at the PRA Speech given by Sam Woods, Deputy Governor, Prudential Regulation and Chief Executive Officer, Prudential Regulation Authority  London Business School 20 March 2017  I am grateful to Dan Curtis for his help in preparing this speech. 1  All speeches are available online at www.bankofengland.co.uk/speeches  Good morning. The UK has a world-leading insurance sector which provides a wide range of vital services to the real economy and society. It promotes growth and employment, has proved its mettle in turbulent times and the country can be proud of it. A necessary precondition to such success is world-class insurance supervision. That is what we aim to deliver at the PRA. Like insurers, our job is to be forward-looking and prudent about risk. Where we differ from private firms is that we do this motivated solely by the public interest. The recent debate about insurance regulation – while timely and important – must seem to some like a cacophony of acronyms, statistics, models and assumptions. But strip this back and you’ll see there is an essential, irreducible human core to it all. Some of the oldest and most vulnerable in our society have invested their life savings into long-term annuity contracts. By pooling and transferring many kinds of risks – from cyber to marine – insurers provide cover which is essential for economic activity. And by protecting for critical illness or personal accident, insurers commit to being there when you need them most.