Dear primary debt market community,
Onbrane is launching 1MM (for 1 Money Market) an industry working group aiming at accelerating the emergence of the Europe Capital Market Union for the money market.
Earlier this year, the ECB issued a statement urging for Europe Capital Markets Union (CMU) and endorsing a specific Action Plan. According to Lagarde, “one of the reasons why the Governing Council was of unanimous and very strong support for the Capital Markets Union to be rolled out” was Europe’s enduring loss of competitiveness over the past decades. Since this statement, many leaders across Europe have relayed this message and set the CMU as a high priority.
Contrary to common belief, the Capital Markets Union objective is not to harmonize Europe national rules, regulation and market infrastructures, it is, as stated on the ECB’s website, “to get money – investments and savings – flowing across the EU so that it can benefit consumers, investors and companies, regardless of where they are located.”
While the end state for Europe is certainly to achieve a unified capital market with consistent rules, regulations, market infrastructure, and a single supervisory body, improving the flow of money across the European Union is not contingent on achieving this end state immediately.
Quite the opposite, the current approach is impeding progress in enhancing the flow of money across the EU, as harmonizing the diverse European capital markets is a massive effort that has made little progress since its inception.
A more effective strategy would be to leverage platforms that enable all capital market actors – issuers, intermediaries, investors – from different markets to connect and better collaborate in financing the real economy. It is much easier, faster and simply more realistic to abstract the complexity of multiple domestic markets rules, regulations and infrastructures behind platforms, and then do the unification of all that complexity in a way transparent to the real economy, than the other way around.
Onbrane is precisely the kind of platform needed to achieve this goal. Onbrane is leading the digitalization of the money market and serves European issuers, intermediaries, and investors. While our current issuers are among the largest in Europe and are already accessing multiple domestic markets, this same capability can be extended to all, including smaller companies.
Let’s unite to respond to the call from the ECB and European leaders. Let’s show the way by completing the Capital Markets Union for the money market, thereby clearing the path for a broader CMU. Together, we can expedite the digitalization of European commercial paper markets – a prerequisite – while identifying and overcoming the most significant obstacles to achieving the money market CMU. Let’s also set an ambitious goal: within three years, we will reach the CMU for money markets in Europe.
Please contact us to join 1MM and be part of the leadership team of this historical endeavor. We intend to meet monthly and to report the progress of this working group to the industry and the ECB on a quarterly basis.
Pascal, CEO Onbrane
