Regulatory Alerts2023-06-12
Principles for the effective management of climate-related financial risks
The Supervisor of Banks issues this directive to implement the Basel Committee's principles, requiring banking corporations to effectively manage climate-related financial risks through sound corporate governance and robust internal controls. Institutions must integrate physical and transition risks into their risk appetite, capital adequacy assessments, and liquidity planning to ensure long-term financial stability. The regulation mandates comprehensive risk identification, monitoring, and reporting across all business lines, with application proportionate to the size and complexity of each banking entity.
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