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Documents on economicsJordi Gual, Matthias Bulach, Oriol Aspachs, Sandra Jódar-Rosell

In light of the enormous implications of the international financial crisis that broke out in 2007, it is essential to consider whether this is going to entail a deep transformation of the financial industry and its players. To this end, the present paper reviews the mechanisms that destabilized financial systems around the world and describes the regulatory changes aimed to ensure their proper functioning in the future. Although the proposed changes move in the right direction, some of the proposals depart from their fundamental objective and could have non-desired effects. In this respect, the paper analyses the influence of all these changes in the formation of a new competitive structure. The result will probably be a financial system with, on average, larger institutions and less horizontal and geographical diversification. The effects on the real economy could be significant during the transition period towards the new model and thus, both the final details and the implementation periods of the new regulations will be crucial. In the long term, nevertheless, the greater resilience of the financial sector should have a positive effect for the robustness of GDP growth.

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