Open, global financial markets and the benefits of regulatory cooperation

Broad regulatory divergence and a patchwork of inconsistent rules would weaken global markets and compound growing levels of market fragmentation, argues Kevin Gaffney.

Kevin Gaffney is director, Secondary Markets and Post-Trade Policy, at UK Finance, a representative body for the banking and finance industry: www.ukfinance.org.uk.

Open, global and competitive financial markets are essential contributors to economic growth and the real economy. Capital markets are a significant driver behind the success of the United Kingdom's financial services sector, both domestically and internationally. They are a key export market and play a vital role in providing businesses of all sizes with the finance they need to grow and develop. The sector creates jobs and supports trade for the benefit of communities both domestically and overseas, channelling investment to drive growth and providing diversified funding to companies outside of traditional bank lending. These functions have proved critical, particularly during the Covid-19 pandemic, when capital markets enabled companies to access crucial financing quickly both during and after the pandemic as economies began to reopen.