François Villeroy de Galhau: Capital Markets Union - unleashing Europe's potential

Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at a conference, Paris, 30 November 2021.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Ladies and Gentlemen,

I am delighted to be with you today and I extend my warmest thanks to all the participants for accepting the Banque de France's invitation to talk about the Capital Markets Union (CMU), as we look towards the French presidency of the European Union. In particular, I owe a special thanks to Mairead McGuinness, our European Commissioner for Financial Services, Financial Stability and Capital Markets Union, for honoring the Banque de France with a keynote speech.

The project to unify our capital markets is actually as old as the European construction project itself. In 1966 already, a group of experts, led by the Italian Claudio Segré, tasked by the Commission1 produced a report in which they pledged for the development of a European capital market. I will try to answer briefly three questions: why, what and – last but not least – how?  

I. Why does the European Union need the CMU?

Although the monetary union was fully achieved with the creation of the euro in 1999, the EU still struggles with financial integration. This assessment is nothing new but has legitimately attracted more attention with Brexit and the Covid crisis, both of which revealed not only the EU financial markets' strengths but also their weaknesses.