Climate Change: Issues for Banking Supervisors

Year Published

2019

Contributing Organizations

International Monetary Fund (IMF)

Global Affairs Canada (GAC)

Toronto Centre

The Swedish International Development Cooperation Agency (Sida)

Type of Resource

Research/Insights Report

Languages

English

Relevant Topics

Core Topic

Risk Management

Topic 2

Impact Assessment

Target Audience

Banks

Financial Services Providers

Relevant Geography

Europe

Resource Description

This resource outlines climate-related risks to banks and explores how banking supervisors can respond through regulation, supervision, and risk management. It offers guidance on integrating climate risk into supervisory frameworks and supporting green finance.

Why This Matters

Banks are exposed to and influence climate-related risks. This resource helps supervisors enhance resilience, disclosure, and alignment with climate goals, especially where broader policy frameworks are weak.

Key Insights

Distinguishes between physical and transition risks affecting credit, market, operational, and reputational exposures
Recommends integration of climate risk into governance, stress testing, scenario analysis, and disclosure
Summarizes UK PRA expectations and the TCFD framework for disclosures
Highlights capacity-building needs including data, tools, and knowledge sharing
Discusses regulatory options such as green lending quotas and risk-weight incentives

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