Title: Capital markets union redux: towards a deeper and more accessible savings and investments union
Authors:
Loukas Kaskarelis,
Arndt-Gerrit Kund,
Mathias Skrutkowski,
Juan Solé (all ESM)
Abstract: Europe faces massive investment needs: it must regain competitiveness, provide stability to its ageing population, and confront climate change and external threats. This has renewed the urgency of the decade-old European Union (EU) project for a capital markets union (CMU). CMU is a cornerstone of the EU strategy to reduce longstanding barriers to integration, while achieving greater economic resilience and mitigating the risk of future crises. By strengthening its financial infrastructure and fostering an integrated financial market, CMU will enable a more efficient matching of savings and investments domestically and across borders. Our contribution to the policy discussion focuses on unleashing the potential of retail investors and small entrepreneurs to make better use of European capital markets, reducing their dependence on banks. We examine the profile of European retail investors and discuss measures that have proved effective in enhancing household participation in capital markets and fostering cross-border investments. We argue that wider access to equity and equity-like instruments is essential for providing the capital needed for growth and for financial stability. We also point to the enhanced role that banks can play through the securitisation of loans for small and medium-sized enterprises (SMEs). These elements would help to convert CMU into a savings and investments union (SIU) for people and firms.
Disclaimer:
The views expressed in this discussion paper are those of the authors and do not necessarily represent those of the ESM or ESM policy. No responsibility or liability is accepted by the ESM in relation to the accuracy or completeness of the information, including any data sets, presented in this paper.
Source: European Stability Mechanism | Discussion Paper Series | Volume 2024 no. 25 | May 2025 | 67 Pages
Copyright © European Stability Mechanism, 2025| All rights reserved. Any reproduction, publication and reprint in the form of a different publication, whether printed or produced electronically, in whole or in part, is permitted only with the explicit written authorisation of the European Stability Mechanism.