Nikolai Tangent, CEO of Norges Bank Investment Management, told CNBC on Tuesday that European capital markets are experiencing a crisis and urged the continent to consolidate its fragmented financial system.
Speaking at the annual Euronext conference in Paris, Tangent stated that Europe must "get its act together" to unify the capital markets in the region. He warned that investors gravitate towards markets with the highest liquidity and valuations, making reforms critically important for Europe's competitiveness.
NBIM manages Norway's sovereign wealth fund, the largest of its kind, valued at just over $2 trillion. The fund invests in over 7,200 companies in 60 countries and holds stakes in approximately 1.5% of global public equities.
Tangen reported that the NBIM equity portfolio has significantly shifted towards American stocks over the past decade. Almost 40% of the fund's investments are now in American stocks, with the largest holdings including a 1.3% stake in Nvidia, a 1.2% stake in Apple, and a 1.3% stake in Microsoft.
The CEO explained this shift as a delay for Europe in technologies and innovations. "This is related to the dominant position of American companies in the field of artificial intelligence — we do not have strong companies in Europe in this area," he said.
In 2025, the sovereign wealth fund reported an annual profit of 2.36 trillion crowns, or $246.9 billion, mainly due to the strength of the technology sector.
Tangen stated that Europe could improve the situation by applying artificial intelligence more effectively, noting some signs of progress in technology adoption. However, he emphasized that market reform remains urgent.
"We cannot have such a fragmented capital market in Europe. We will not achieve liquidity, we will not achieve market depth," he said. He warned that without consolidation and unified rules to facilitate cross-border trade, Europe risks falling further behind.
In his speech at the conference, Tangen outlined the changes he deems necessary, including the harmonization of financial and corporate legislation in Europe, a review of competition and innovation policies, as well as improving capital movement within the system. NBIM holds stakes in 2.3% of all European public companies.
"Are European capital markets experiencing a crisis? Probably, but in that case, let's not waste a good crisis. We know what needs to be done. And it needs to be done, otherwise, we will lose. We will fall. It's time to act," Tangen stated.