Shadow banking and European offshore financial centres: the blind spot in EU policy debates
Current debates in the EU on the Capital Market Union (CMU) include activities that are part of the shadow banking system, in particular securitization. The market for securitized assets has made a comeback after the great financial crisis and is currently presented as a complementary funding channel for the EU. Securitization has been re-branded into “high-quality” securitization to stress the distinctive marketplace the commission is aiming at. In at least one aspect the proposals for a market for high-quality securitization and more broadly the EU wide shadow banking system, is not different, namely in its spatial organization in European offshore financial centres (OFCs).
By Rodrigo Fernandez, Researcher SOMO/ University of Leuven