Regulatory Alerts2025-12-17
Guidelines on Effective Risk Management of Climate-Related Financial Risks
The Central Bank of Seychelles has issued these Guidelines to require regulated institutions, including commercial banks and credit unions, to systematically integrate climate-related physical and transition risks into their comprehensive risk management frameworks. Institutions must establish robust governance oversight, embed climate risks across the three lines of defence, update their Internal Capital Adequacy Assessment Processes, and conduct forward-looking scenario analyses to quantify capital and liquidity impacts. The requirements apply proportionately based on institutional size, complexity, and risk materiality, mandating clear Board and Senior Management accountability while allowing flexibility for institutions where climate risks are deemed immaterial.