Climate ultimatums for European banks – Finance

The process has begun, but there is still a long way to go before we can say that banks are sufficiently equipped to deal with climate changeunderlined the vice-president of the supervisory board of the ECB, Frank Elderson.

According to the Frankfurt-based institution, the risks are generally underestimated. That’s why she decided to impose ultimatums. These risks for the activities of banks must be listed by March 2023. By the end of the year, they must be integrated into management, strategy and management. By the end of 2024, all ECB requirements will have to be met.

The institution has already been pleading for some time for banks are preparing to deal with the consequences of climate change, such as floods or business bankruptcies following the introduction of stricter environmental rules.

In July, the ECB said that according to the results of a first climate stress test, banks could lose up to 70 billion euros for climate reasons.

The process has begun, but there is still a long way to go before it can be said that banks are sufficiently equipped to deal with climate change, said ECB Supervisory Board Vice-Chairman Frank Elderson. According to the Frankfurt-based institution, the risks are generally underestimated. That’s why she decided to impose ultimatums. These risks for the activities of banks must be listed by March 2023. By the end of the year, they must be integrated into management, strategy and management. By the end of 2024, all ECB requirements will have to be met. The institution has already been advocating for some time for banks to prepare to deal with the consequences of climate change, such as floods or business bankruptcies following the introduction of stricter environmental rules. In July, the ECB said that according to the results of a first climate stress test, banks could lose up to 70 billion euros for climate reasons.