Weather, or not: is climate risk just part of credit risk?

Practitioners divided on whether climate risk can fit into existing credit risk weights

Climate and credit

When regulators face a new risk in the banking sector, their natural response is to decide how much capital banks need to hold against it. The largest emerging risk is from climate change: either the physical risks of extreme weather events and rising sea levels, or the transition risk of policy changes to clamp down on carbon emissions. Both will potentially cause defaults to flow through bank loan books.

The Basel Committee on Banking Supervision has already begun work on how to incorporate

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

Most read articles loading...

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here