Regulatory Alerts2023-01-12
Added · Updated
Frequently asked questions on climate-related financial risks
The Hong Kong Monetary Authority issued this circular to incorporate Basel Committee on Banking Supervision responses regarding climate-related financial risks into its supervisory framework. The guidance clarifies how these risks should be captured under existing Basel Pillar 1 standards, specifically addressing risk-weighted asset calculations for credit, operational, and market risks, as well as the Liquidity Coverage Ratio. Authorized institutions are required to consider these FAQs when interpreting and applying the Basel Framework to ensure globally consistent implementation without altering the underlying standards.
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