MNI BRIEF:Fines For Banks Missing Climate Goals-ECB's Elderson

This year will be a “crucial” one for banks to align fully their climate and environmental risks with the expectations of eurozone supervisors, ECB Executive Director Frank Elderson wrote in a blog on Wednesday, adding that otherwise banks will face financial penalties and increases in Pillar 2 capital requirements.

“By the end of this year, we expect all banks under our supervision to be fully aligned with all our supervisory expectations on the sound management of C&E risks,” he wrote. (See MNI INTERVIEW:ECB To Fine Banks Missing Climate Goals-Elderson)

Banks with material C&E risks would be expected to reflect these in their baseline and adverse stress test scenarios by the end of this year, Elderson wrote.