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Regulation of the EU Financial Markets - MiFID II and MiFIR edited by Busch, Danny; Ferrarini, Guido (12th January 2017)

Part V The Broader View and the Future of MiFID, 22 Shadow Banking and the Functioning of Financial Markets

Eddy Wymeersch

From: Regulation of the EU Financial Markets: MiFID II and MiFIR

Edited By: Danny Busch, Guido Ferrarini

From: Oxford Legal Research Library (http://olrl.ouplaw.com). (c) Oxford University Press, 2015. All Rights Reserved.date: 27 May 2020

Subject(s):
Regulatory liability of lenders — Shadow banking — Securities — Financial stability

This chapter considers the financial activity taking place outside the traditional and often unregulated financial sphere of the securities markets, which has become substantial and diverse, and is often called ‘shadow banking’, a misnomer. These activities, mapped by the Financial Stability Board, include a variety of entities which specialise in certain financial activities, or provide financial services as part of their overall product offer. They create risks of a ‘systemic’ nature, leading to major financial disruption and contagion. Although thought to be on the border of the traditional securities systems, these matters and the related regulation have a considerable impact on the framing of certain classes of securities and may determine the safety of the overall system, including that of the final investor.

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