What is the capital markets union?
The capital markets union is a plan to allow money – investments and savings – to flow across the European Union. Consumers, investors and companies would benefit, regardless of their location.
Why is this important?
Europe needs to invest in strategic technologies and infrastructure. A single market for capital would help mobilise capital for these investments. Europe doesn’t lack capital, but we need to put the capital to work wherever it’s needed.
What’s the European Investment Bank Group’s role in the capital markets union?
The EIB Group is creating financial instruments that could be the building blocks of a real capital markets union. These instruments can take the abstract idea of capital markets union and turn it into tangible reality in the capital markets.
Our four capital markets union building blocks
Expand the European Tech Champions Initiative
European tech champions in European Investment Bank. Launched through the European Investment Fund, our subsidiary for promoting small and medium-sized businesses, the European Tech Champions Initiative is an innovative fund-of-funds that uses public money to channel capital to large venture capital funds. The goal is to finance European scale-ups with European capital, so that our innovators and entrepreneurs no longer have to sell their businesses to investors from the US, China or elsewhere, because of a lack of European investment.
Leverage our strong securitization experience to launch a pan-European securitisation platform.
Climate change requires massive investment, including in the areas of urban regeneration, energy efficiency, and building renovation. Securitisation, including green asset‑backed securities, could contribute to funding sustainable projects and create an attractive new asset for investors to aid the European Union’s green transition.
Facilitate growth of digital bond issuance using public blockchains across Europe.
This would improve access for smaller companies, currently mostly dependent on access to bank loans. The EIB Group has pioneered the digital bond market. We launched four digital bonds between 2021 and 2023, experimenting with different technologies, financial engineering features, and legal frameworks. We see strategic potential in working with Eurozone Central Banks and the European Central Bank to assess the design of a potential future digital Euro.
Standardised green bond market in the European Union.
We can build on our longstanding leadership in green finance. After all, we issued the world’s first green bond in 2007. Since then, we have issued Climate Awareness Bonds and Sustainability Awareness Bonds worth €93 billion in 23 different currencies. This makes us the largest multilateral development bank issuer of use-of-proceeds green and sustainability bonds. Europe’s regulatory and supervisory framework for sustainable finance is evolving towards a single classification system for economic activities that contribute to EU sustainability objectives. The result will be standardised information that investors can really use. This is a core condition for fair competition, for the efficient pricing of investment alternatives, and effective investment within the capital markets union.