The European Central Bank, acting as the single banking supervisor in the euro area, said, in an updated assessment it published on Monday 14 March, that, despite some improvements, consolidated information on the climate risk exposure of the banking groups it directly supervises is “still insufficient”.
More than 70% of banks report on how their board oversees climate and environmental risks, up from 50% in November 2020 when the first assessment was made. On the other hand, roughly 75% of the banks analysed do not disclose whether climate and environmental risks have a material impact on their risk profile, although half of the banks concerned acknowledge to the ECB that they are indeed exposed. And almost 30% of the banks in the panel, that have committed to aligning their exposures with the Paris Agreement do not provide any information to back this up.
Among the best practices observed, the ECB reports on a bank that has set itself the goal of being climate neutral by 2050 and publishes its progress against self-imposed interim targets. Some banks also publish scorecards on the performance of their loan portfolios in sectors (electricity, oil and gas, automotive) affected by the climate transition process.
More info at: https://aeur.eu/f/ri (Original version in French by Mathieu Bion)