U.S. Bank Regulators Drop Climate Risk Guidance
Amid a policy shift, U.S. banking regulators are scrapping guidance that aimed to help large banks identify climate-related financial risks.
The Federal Reserve Board, the Federal Deposit Insurance Corp. (FDIC), and the Office of the Comptroller of the Currency had adopted principles designed to address weaknesses in how banks deal with the risks posed by climate change.
The guidance, which applied to banks with over US$100 billion in assets, has been retracted, according to a joint release by the regulators.
The regulators are retracting the guidance that aimed to help large banks identify climate-related financial risks.
This move marks a significant shift in policy, as the regulators had previously sought to address the physical and transition risks that climate change poses to banks' soundness.
Author's summary: Regulators scrap climate risk guidance for large banks.