European associations release report on improving competitiveness of European capital markets

European capital markets lag behind the US, risking Europe’s economic growth and ability to fund innovation, green initiatives, and address aging population needs.

To address this challenge, the European Banking Federation (EBF), the European Fund and Asset Management Association (Efama) and the Federation of European Securities Exchanges (Fese) have released a joint report on the development of European capital markets and recommendations to enhance their competitiveness.

The report, co-developed by the three European associations and authored by consulting firm Oliver Wyman, has shed light on the progress made towards the Capital Markets Union with insights from various capital markets leaders on how to succeed in the coming decade and beyond.

UK still “highly attractive” as capital market hub to FTSE leaders

The report underscored the significance of maximising Europe’s capital markets infrastructure, amplifying capital pools and improving investor outcomes. It stressed on activating demand by enhancing retail investors’ access to appealing products, boosting financial literacy, incentivising retirement savings and establishing tax structures conducive to long-term investments.

The authorities suggested that the report is a guide for policymakers, regulators and industry stakeholders, illustrating how capital markets thrive on scale and a “flywheel effect.” 

Magnus Burkl, head of capital markets Europe at Oliver Wyman, said: “To reach its full potential, Europe needs to activate long-term capital pools across retail and institutional investors, which can act as a flywheel for increasing the competitiveness of capital markets.”

EFAMA: Real-time data key to capital market ambitions

FESE director general Rainer Riess commented: “Europe needs deep and liquid capital markets to finance its companies and deliver attractive valuations. Cutting red tape and getting citizens to put their investments into capital markets are key to unlocking the flywheel.”

Tanguy van de Werve, director general at Efama, said: “Increasing pension savings of European citizens is key to help fill the retirement gap and can boost Europe’s capital markets. Bold actions from policymakers are now required to defuse the pension time bomb and allow our companies to thrive.”

Wim Mijs, CEO, EBF, added: “Developing vibrant and competitive European capital markets is crucial to harness the necessary financing power to usher in true economic transformation in the EU.”

For more information about the report and its findings, please contact: [email protected], [email protected] or [email protected]

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