The Governor of BoE, Mark Carney, launched the "COP26 Private Finance Agenda" to help private finance support the whole economy transition to net zero. The objective of the Agenda is that every professional financial decision will need to take climate change into account. The right framework for reporting, risk management, and returns will embed these considerations and help finance a whole economy transition. To achieve net zero, every company, bank, insurer, and investor will need to adjust their business models for a low carbon world. BoE has also published the speech of Mark Carney on the launch of COP26 Private Finance Agenda.
The following are the key highlights of the COP26 private finance strategy:
- Refine climate-related financial disclosure to increase quantity and quality of reporting
- Agree potential paths to mandatory reporting at domestic and international levels
- Ensure that firms and investors can measure and manage the risks in the transition to a net zero world
- Assess the resilience of firm’s strategies to net zero transition through stress tests. Develop open source, business-relevant reference scenarios for regulators, financial firms, and businesses to test strategic resilience
- Encourage Multilateral Development Banks to report their own emissions and exposure to climate risks, in line with the Taskforce for Climate-related Finance Disclosures (TCFD)
- Work with private sector to promote the most promising and impactful financial innovations in sustainable finance (including transition bonds, contingent climate securitizations, and the scaling up of rapid private markets for carbon offsets and nature-based solutions)
Keywords: Europe, UK, Banking, Insurance Securities, Private Finance Agenda, ESG, Disclosures, TCFD, Climate Change Risk, Reporting, Sustainable Finance, COP26, BoE
BCBS is consulting on the principles for operational resilience and the revisions to the principles for sound management of operational risk for banks.
The Financial Stability Institute (FSI) of BIS published a brief note that examines the supervisory challenges associated with certain temporary regulatory relief measures introduced by BCBS and prudential authorities in response to the COVID-19 pandemic.
HKMA, together with the Banking Sector Small and Medium-Size Enterprise (SME) Lending Coordination Mechanism, announced a ninety-day repayment deferment for trade facilities under the Pre-approved Principal Payment Holiday Scheme.
The Advisory Scientific Committee of ESRB published a response, in the form of an Insights Paper, to the EBA proposals for reforms to the stress testing framework in EU.
MAS announced several initiatives to support adoption of the Singapore Overnight Rate Average (SORA), which is administered by MAS.
BoE updated the reporting template for Form ER as well as the Form ER definitions, which contain guidance on the methodology to be used in calculating annualized interest rates.
PRA published the policy statement PS19/20 on the final policy for extending coverage under the Financial Services Compensation Scheme (FSCS) for Temporary High Balance.
EBA published the final draft implementing technical standards for disclosures and reporting on the minimum requirements for own funds and eligible liabilities (MREL) and the total loss-absorbing capacity (TLAC) requirements in EU.
EBA published an erratum for the phase 2 of technical package on the reporting framework 2.10.
EC published the Implementing Regulation 2020/1145, which lays down technical information for calculation of technical provisions and basic own funds.