Regulatory Alerts2025-01-01
Guidelines on environmental scenario analysis
The European Banking Authority issued these Guidelines to specify how institutions must conduct scenario analysis to test their resilience against environmental risks, particularly climate-related factors. The document mandates that institutions integrate these analyses into their risk management frameworks to assess both short-term financial shocks and long-term business model adaptability. These requirements apply from 1 January 2027 and complement existing ESG risk management standards by focusing on physical and transition risks stemming from climate change.
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