Regulatory Alerts2024-01-01
Guidelines on Management of Climate-Related and Environmental Financial Risks for Banks and Bank Holding Companies 2024
The Reserve Bank of Malawi has issued binding guidelines requiring all domestic banks and bank holding companies to systematically integrate climate-related and environmental financial risks into their corporate governance and risk management frameworks. Institutions must establish clear board oversight, implement a three-lines-of-defense internal control structure, and conduct regular scenario analysis and stress testing to evaluate business model resilience against physical and transition risks. Furthermore, the guidelines mandate annual public disclosures detailing governance structures, strategic approaches, risk identification processes, and key performance metrics to enhance transparency and support the transition to a low-carbon economy.