Global Regulators Ramp Up Focus on Climate Risks in Banking
Banking regulators worldwide are intensifying efforts to assess financial risks from climate change. This decision follows an American pushback. The global forum's oversight body prioritizes extreme weather event implications. European focus contrasts with a cautious U.S. approach. The Basel Committee's international standards influence national rulemaking globally.
Global banking regulators have agreed to intensify their efforts to comprehend the financial risks associated with climate change, despite facing resistance from the United States. The Bank for International Settlements reported that the oversight body of the world's forum for banking regulators convened on Monday to evaluate the committee's work on climate-related financial risks.
The body has resolved to prioritize the understanding of financial risk implications stemming from extreme weather events. This decision arises amidst ongoing debates between policy makers and banking regulators on both sides of the Atlantic regarding the inclusion of climate change considerations in central bank policy. Analysts predict this debate will significantly influence central bank decision-making worldwide.
European regulators have ramped up initiatives to tackle climate-related risks, unlike their U.S. counterparts, who have reduced or abandoned similar efforts. The Basel Committee on Banking Supervision's oversight body plans to release a voluntary disclosure framework for jurisdictions to consider. While lacking enforcement authority, the Basel Committee's standards hold considerable sway over national regulatory practices.
(With inputs from agencies.)
Google News