public financial institutions in europe 1 mathias schmit brussels, 11 th october 2011
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Public Financial Institutions in EuropePublic Financial Institutions in Europe
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Mathias SchmitBrussels, 11th October 2011
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Public Financial Sector in the EU27+5 Public Financial Sector in the EU27+5
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•Who?
•What?
•Why?
•How?
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Who?
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Mar
ket s
hare
of i
nstit
ution
s w
ith p
ublic
par
ticip
ation
(%)
Market share of public companies (%)
Levels of public involvement in the European financial industryLevels of public involvement in the European financial industry
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What?What?
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Why?Why?
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• Mitigate negative externalities
• Maximise positive externalities
• Compensate the private sector’s short-sightedness
• Preventing capital drain from poorer to richer regions
• Jump-starting financial development to avoid desintermediation
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How?How?
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• Description of main business models in the EU27+5
• National and Regional Development agencies• Municipal Credit Institutions• Export Credit Agencies• Public Savings banks• Long-term investors• Public Financial Intermediaries
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EAPB study fills a wide gap in the literature EAPB study fills a wide gap in the literature • PFI are not defined (essentially based on ownerships)
• Studies mainly on performance– Results quite mitigated (diverging opinions)
– Without any ex-ante links to their missions / roles / business models
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=> This study includes a complete sector analysis
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Key MessagesKey Messages
• Key roles of the public financial institutions – in a volatile environment– Multiple functions– Mutiple business models
• Multi-dimensional performance metrics for public financial institutions– Multiple bottom lines
• Outreach• Adequate financial metrics• Risk vs. retuns• Efficiency vs. effectiveness
– Be aware of dogmatic thoughts and one fits all approach– In view of Basel III
• Examples - Illustrations
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Thank you for your attentionThank you for your attention
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Contact detailsMathias Schmit
Managing Director SAGORAProf. Solvay Brussels School of Economics and Management
Email: [email protected]: 0032-496.93.22.70