In line with the "growing importance" of climate change for the economy and with the greatest data available demonstrating its financial impact on banks, the ECB "will take climate risks into account in the next stress test in 2022".
This was announced by the ECB, in publishing the final text of the Guide on climate and environmental risks for banks, adding that further details will be provided in the course of 2021. Another report, also published today, shows that banks are "significantly behind. "on the subject of information on climate and environmental risks.
"Despite some improvements compared to last year, banks must make significant efforts to better support their disclosure to the public with relevant quantitative and qualitative data", underlines Frankfurt, so "in the second half of 2021 the ECB intends to identify remaining shortcomings and discuss them with the banks ".
The Guide on climate and environmental risks illustrates how the ECB expects banks to "manage these risks in a prudent manner and provide transparent information in this regard in compliance with current prudential regulations".
Frankfurt will now monitor the implementation status of the guide through two concrete actions.
At the beginning of 2021, banks will be asked to conduct a "self-assessment" in the light of the supervisory expectations defined in the guide and to "draw up an action plan on this basis".
The ECB will subsequently carry out a comparative analysis of the self-assessments and action plans, which will be the subject of a "critical comparison" as part of the supervisory dialogue.
A complete supervisory review of bank practices will therefore be carried out in 2022, which the ECB will follow up with concrete interventions where necessary, explains the Central Institute.
(HANDLE).
