Abstract
A salient trait of the recent evolution of financial systems is their globalization. Their growing integration not only involves short-term capital movements, but also extends to long-term capital and securities representing equity interests1. In parallel, a clear trend towards “managed” savings has established itself (Figure 1). The search by final savers for the competitive yields ensured by institutional investors has made for a decline in the demand for monetary assets, while the demand for marketable securities in deep, resilient and liquid environments surged.
A fuller version of this note will be published in the series SUERF papers on Monetary Policy and Financial Systems.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
Notes
A capital market is ‘efficient’ if at every moment it fully and accurately reflects all the relevant information for determining securities prices. See, for example, E. Fama, ‘Efficient Capital Markets’, Journal of Finance,1991.
For a review of the problems and the literature, see R. Masera, Intermediari, Mercati e Finanza d’impresa, Laterza, Bari, 1991; G. Marotta and G. Pittaluga, La teoria degli intermediari bancari, Il Mulino, Bologna, 1993; G. Coppola and D. Corsini, ‘Teoria dell’intermediazione creditizia’, Quaderno no.41, Studi e informazioni, Banca Toscana, Florence, 1993; and G. Calise, Asimmetrie informative e mercati finanziari, doctoral dissertation, LUISS University of Rome, Academic Year 1993–94.
See, for example, R. Merton, ‘Operation and Regulation in Financial Intermediation: a Functional Perspective’, Harvard Business School, WP 93020, 1992.
It is worth recalling the futures and options markets in catastrophes introduced notably by the Chicago Board of Trade. For a survey of this field, see G. Siani, ‘Innovazione Finanziaria e Mercato assicurativo: gli Strumenti Derivati Relativi a Catastrofi Naturali’,forthcoming.
At a more detailed level of analysis of the system of managed collective savings it is possible to distinguish between pension funds, which can be classified as institutional investors, and their management companies, whose functions make them exercise a principal-type financial intermediary role. For a survey of funds management institutions see S. Preda (ed.), Funds and Portfolio Management Institutions: an International Survey, North-Holland, Amsterdam, 1991.
On this point, see D. Fair and C. de Boisseu, Financial Institutions in Europe under New Competitive Conditions, Kluwer, Dordrecht, 1990, and F. Bruni, ‘Sui rapporti tra politica monetaria, regolamentazione finanziaria e vigilanza: fra macro e microeconomia monetaria’, Working paper no. 6, Università Bocconi, Milan, 1993, as well as the second part (‘Finance’) of Europe and Global Economic Interdependence, (L. Bekemans and L. Tsoukalis, eds.), College of Europe, European Interuniversity Press, 1993. See also, C. Anfossi, ‘La Vigilanza Prudenziale su Banche, Assicurazioni e Imprese di Investimento: Una Nuova Proposta di Direttiva’, Nota Tecnica, 1/94, February 1994, IMI Group.
For an interesting description of this tendency, see D. Folkerts-Landau and P. Garber, ‘The Role of the ECB in European Financial Markets: Some Lessons from Recent Experience’, Luxemburg Conference in Honour of Pierre Werner, 18–20 November 1993. The authors underscore the liquidity needs of the present configuration of the US financial system but, since they adopt a traditional approach to disintermediation, fail to identify the possibility envisaged in this paper, whereby the evolution of the European financial structure may be characterized by bank diversification.
See R. C. Merton and A. E Perold, ‘Management of Risk Capital in Financial Firms’, Harvard Business School, W.P. no. 38, 1993.
For a theoretical analysis, see R. P. Rumelt, Strategy, structure and economic performance, Harvard Business School Press, Boston, 1986 and P. Mottura, ‘Evoluzione della banca verso forme di intermediazione finanziaria innovative e diversificate’, mimeo, Università Bocconi, Milan, 1992.
This appears to be a significant difference between banks and non-banks as regards the theory of diversification. It is also worth noting that, technically speaking, the concept of financial conglomerate appears to be in any case inappropriate. The controls that the parent company is required to effect call for a unified strategic management and the unified control of credit and market risks.
See R. Masera, ‘The Universal Bank, The Special Credit Institution and The Banking Group in Italy: The Effects of Market Forces and Prudential Regulations’, in P. Gilibert and F. Spinelli (eds.), Corporate Governance and Finance in Italy: Which System for the Future? Fondazione Banca CAB, Brescia, 1944.
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 1994 Springer Science+Business Media Dordrecht
About this chapter
Cite this chapter
Masera, R. (1994). European Financial Intermediaries and Markets: Lines of Development in an International Context. In: Fair, D.E., Raymond, R. (eds) The Competitiveness of Financial Institutions and Centres in Europe. Financial and Monetary Policy Studies, vol 28. Springer, Dordrecht. https://doi.org/10.1007/978-94-015-8350-3_3
Download citation
DOI: https://doi.org/10.1007/978-94-015-8350-3_3
Publisher Name: Springer, Dordrecht
Print ISBN: 978-90-481-4469-3
Online ISBN: 978-94-015-8350-3
eBook Packages: Springer Book Archive