Investing.com -- Norway’s sovereign wealth fund, Norges Bank Investment Management (NBIM), the world’s largest of its kind, has urged the European Union (EU) to speed up efforts in unifying its capital markets. NBIM expressed this via a 14-page letter sent to the European Commission on Tuesday.
The letter was a response to a consultation on streamlining the union’s financial systems. NBIM is encouraging the EU’s executive branch to standardize withholding-tax rules, lower settlement costs, and enhance digital infrastructure.
NBIM pointed out that European markets have been lagging in terms of business dynamism and the provision of new investment opportunities to institutional investors over time. The fund is striving for a more streamlined and efficient financial system in the EU.
As of the end of 2024, NBIM held €285 billion ($325 billion) in securities issued by EU member states and European corporates. The letter from NBIM is part of an ongoing EU consultation process about the establishment of a Saving and Investments Union framework.
NBIM also suggested that the EU centralize supervision of capital markets to ensure all member states consistently apply rules. The fund highlighted that the current system, with a variety of national regulators, promotes regulatory arbitrage and legal uncertainty.
The fund emphasized that better and simpler regulation is crucial to facilitating the evolution of capital markets. The fund’s suggestions aim to streamline the EU’s financial systems and achieve a more unified capital market.
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