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Small is beautiful? Capital market funding for sub-sovereign authorities on the rise

July 25, 2014
Region:
Sub-sovereign bonds are a segment that has attracted little attention to date. Bonds are the dominant form of funding for Germany's Länder, though, and they also play an important role for the regions in Spain. While the Länder benefit from Germany’s excellent sovereign rating, only those Spanish regions not forced to request financial assistance from the central government at the height of the debt crisis have recently been able to obtain financing via the capital market. In France the issuance by the municipalities is likely to increase due to the newly established Agence France Locale. A local authority finance agency is also in the process of being introduced in the United Kingdom. The importance of the sub-sovereign bond market crucially depends on country-specific institutional arrangements. [more]

More documents contained in "EU Monitor"

87 (85-87)
July 23, 2008
Region:
85
The euro was launched with great expectations in 1999 and is a success story today. This is based on a high degree of price stability, the stimulation of trade and investment in Europe, good progress in financial market integration, and a growing international role played by the euro. But there have been disappointments, too, especially as far as growth and EMU enlargement are concerned. The monetary union faces major challenges as it enters its second decade. The distortion of competitive positions within EMU needs to be corrected. And the reformed stability pact still has to stand the test in conditions of weak growth. [more]
April 22, 2008
Region:
86
Recent market turmoil and its consequences will negatively impact the earnings of European banks for a considerable time. This reverses a long period of improvements in profitability and efficiency. But: the current environment should not distract from the trends that have favourably shaped the structure of the industry for the last 10 years and will continue to do so: consolidation, internationalisation, convergence and increasing specialisation. In this study, we consider to what extent these trends are going to further shape the banking sector in the foreseeable future. [more]
June 16, 2006
Region:
87
Neither theory nor empirical observations can justify an interventionist industrial policy. Under the euphemism of economic patriotism, a policy based mainly on protectionist measures and state support will ultimately harm the competitiveness of affected industries. Such an approach threatens the viability of the single European market. A more promising alternative would be an economic policy that offers growth-enhancing framework conditions to create an attractive environment for domestic firms and foreign investors alike. [more]
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