APRA will be seeking to undertake a.......>

AUSTRALIA: APRA will be seeking to undertake a climate change financial risk

vulnerability assessment. The assessment will begin with Australia's largest

authorised deposit-taking institutions (ADIs). Beginning with the ADI industry

will provide helpful insights on the impact of a changing climate on the broader

economy, which will be analysed in conjunction with the Reserve Bank of

Australia (RBA). The ADI vulnerability assessment will be designed in 2020 and

executed in 2021, with other industries to follow. This timing also aligns with

the expected release of international peer regulator guidance on scenario

analysis for the banking sector. The vulnerability assessment will involve

entities estimating the potential physical impacts of a changing climate,

including extreme weather events, on their balance sheet, as well as the risks

that may arise from the global transition to a low-carbon economy. APRA will

coordinate this work with the Australian Securities and Investment Commission

(ASIC) and the RBA via the Council of Financial Regulators to ensure consistency

in the application of scenario analysis, disclosure recommendations and to

analyse the macro-economic impacts of climate change.