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Spreadsheet

Managing climate risk demands fresh thinking on stress tests

Risks related to climate change are increasingly being taken seriously by regulators and banks, but the modeling around these risks is complex and is still under development

APRA to scrutinise bank climate change efforts more deeply

Banks in Australia will have to stress test their resilience to financial risks associated with climate change, the Australian Prudential Regulation Authority (APRA) said in a letter.

Jose Manuel Campa

EBA’s stress test overhaul given the cold shoulder

Proposals put forward by the EBA to modernise its stress testing framework have met with disapproval by banks arguing that they would deliver few benefits 

Fed approves stress capital buffer with some changes

The stress capital buffer (SCB), a simpler capital framework for banks, has been approved by the US Federal Reserve Board and is broadly similar to proposals made in April 2018 with some changes made to reflect feedback. 

EU banks to be subject to toughest stress test yet

Banks in the EU will be subject to the most demanding stress tests to date to see how they would stand up to very low interest rates, growing trade tensions and a disorderly departure from the union by the UK. 

US stress tests to include scenario on corporate debt problems

The harshest scenario in the 2020 US Comprehensive Capital Analysis and Review (CCAR) and stress tests will include a severe global recession, stressed corporate debt and commercial real estate markets, and leveraged loan pressures. 

Flooding

Bank of England uses climate change scenarios for stress test

Proposals by the Bank of England for stress testing the effects of climate change on the financial system places the issue front and centre for UK regulators and financial firms 

Big UK banks pass stress test, but told to raise countercyclical buffer

The latest stress tests from the Bank of England showed that the UK’s seven largest lenders could comfortably manage a deep domestic recession, a global downturn and a disorderly exit from the EU. 

Bank of England to stress-test financial firms for climate change

The Bank of England plans to stress test how the financial system would stand up to various climate pathways, making it the first central bank to do so. 

ESMA releases funds stress testing framework

A stress testing framework for investment funds has been developed by The European Securities and Markets Authority (ESMA) so national competent authorities (NCAs) can probe the sector’s robustness.