Banking authority targets climate risks with new guidelines

The European Banking Authority (EBA) has initiated a public consultation regarding draft amendments to its guidelines on systemic risk buffers specifically designed to mitigate climate change risks.

The revised framework intends to facilitate a more effective use of capital buffers to address the systemic dangers originating from environmental shifts.

Greater granularity is introduced through the draft guidelines to help identify exposures subject to both physical and transition risks related to climate change.