Mr. Aidan Carrigan:

Absolutely. The range of fund management instruments with which we are familiar — the collective investment funds, alternative investment funds and venture capital funds — would be employed to raise funds in the shadow banking sector and they would be invested to generate returns. In parallel, there are securitisations and the development of the market in this context to take funds off banks' books and allow banks further liquidity to lend more. It is all integrated with the banking sector. Also to be considered in the markets area is the range of derivative instruments operating in the shadow banking sector. All of these strands are separately regulated, to some extent, but the view is that there needs to be a more harmonised approach.

A difficulty in the debate on the need to regulate the shadow banking sector further is that there is no clear definition of "shadow banking sector". This is because it is a collection of a range of derivatives, funds, securities and trading and deposit-like instruments.