MNB to Introduce Bank Capital Requirement Discounts for Green Lending
MNB and European Bank for Reconstruction and Development (EBRD) organized an international online conference on green finance. The discussions at the conference focused on the assessment and quantification of the adverse economic effects of climate change, energy efficiency investments to achieve a green recovery from the COVID-19 pandemic, and funding opportunities for renewable energy production. MNB announced that it will shortly introduce new bank capital requirement discounts supporting green corporate lending, while transforming its own operations to become fully net zero carbon.
Csaba Kandrács, Deputy Governor of MNB, highlighted that MNB the new capital requirement discount to support green corporate lending would initially cover renewable energy investments and green bonds purchases. He added that MNB will become completely carbon-neutral. It will offset its emissions in 2020 by financing ecological investments next year. In the meantime, it plans to reduce its emissions significantly primarily by swapping its energy consumption for green energy.
At the meeting several speakers discussed financial risks of environmental nature. In their speeches, Ma Jun, Special Advisor to the Governor of PBC, and Jo Paisley, Co-President of GARP Institute, underlined that financial institutions have started assessing the adverse effects arising from climate change and have begun to implement them into their risk management procedures, but there was much to be done urgently. In addition, Sean Kindey, co-founder and CEO of the Climate Bonds Initiative, described the global trends in the green bonds market. He noted that the growth of these new types of instruments was not restricted by COVID-19 pandemic. The closing panel discussion clarified the potential opportunities offered by green bonds for Central Europe, pointing out that green bonds may provide additional funds the for necessary investment projects in the region.
Related Links
Keywords: Europe, Hungary, Banking, COVID-19, Climate Change Risk, ESG, Green Bonds, Regulatory Capital, EBRD, Sustainable Finance, MNB
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Victor Calanog, Ph.D.
Leading economist; commercial real estate; performance forecasting, econometric infrastructure; data modeling; credit risk modeling; portfolio assessment; custom commercial real estate analysis; thought leader.
Previous Article
BoE and FCA Launch Public Private Forum on Artificial IntelligenceRelated Articles
EC Issues Regulation on Adjustments to K-Factor Coefficients Under IFR
The European Commission (EC) published a report summarizing responses to the targeted consultation on the supervisory convergence and the single rulebook in the European Union (EU).
OSFI Issues Results of Pilot on Climate Risk Scenario Analysis
The Office of the Superintendent of Financial Institutions (OSFI) published an update on the discussion paper that intended to engage federally regulated financial institutions and other interested stakeholders in a dialog with OSFI, to proactively enhance and align assurance expectations over key regulatory returns.
ECB Issues Opinions on Green Bonds Standard and CRR Proposals
The European Central Bank (ECB) published its opinion on a proposal for a regulation on European green bonds, following a request from the European Parliament.
ESRB Explores Policy Response to Risks Arising from Digitalization
The Advisory Scientific Committee (ASC) of the European Systemic Risk Board (ESRB) published a report that explores the expected impact of digitalization on provision of financial and banking services, and proposes policy measures to address the risks stemming from digitalization.
EU Authorities Address COVID-19 Reporting, MCD, and PSD2 Issues
The European Banking Authority (EBA) announced that the guidelines on the reporting and disclosure of exposures subject to measures COVID-relief measures shall continue to apply until further notice.
FI Publishes Multiple Regulatory and Reporting Updates
The Swedish Financial Supervisory Authority (FI) announced that the capital adequacy reporting as at December 31, 2021 must be done by February 11, 2022.
BSP Tackles Aspects of Lending and Islamic, Open & Sustainable Finance
The Central Bank of the Philippines (BSP) issued communications covering developments related to online lending platforms, open finance framework and roadmap, and on the expected regulations in the area sustainable finance.
US Agencies Issue Regulatory Updates, FDIC Launches Tech Sprint
The Board of Governors of the Federal Reserve System (FED) published the final rule that amends Regulation I to reduce the quarterly reporting burden for member banks by automating the application process for adjusting their subscriptions to the Federal Reserve Bank capital stock, except in the context of mergers.
EBA Issues Guide on Bank Resolvability, Consults on Transferability
The European Banking Authority (EBA) published its assessment of risks through the quarterly Risk Dashboard and the results of the Autumn edition of the Risk Assessment Questionnaire (RAQ).
MFSA Publishes CRD5 Updates and Supervisory Priorities for 2022
The Malta Financial Services Authority (MFSA) updated the guidelines on supervisory reporting requirements under the reporting framework 3.0.
