Featured Product

    BCB Proposes Sustainability Criteria for Granting Rural Credit

    March 12, 2021

    BCB proposed standards that define the sustainability criteria applicable to the granting of rural credit and the characterization of enterprises with restrictions on access to rural credit due to legal or non-legal provisions related to socio-environmental issues. This consultation constitutes the first initiative that is part of the BCB Agenda on sustainable finance (launched last year) and the comment period for this consultation closes on April 23, 2021.

    The proposal clarifies that the application of sustainability criteria will result in the following categorization of projects:

    • Projects that cannot be financed with rural credit, due to the existence of legal provisions that prevent granting of financing.
    • Projects that may be financed with rural credit, with a signal to financial institutions that the operation represents socio-environmental risk; these projects shall not be classified as sustainable operations.
    • Projects that may receive the classification of sustainable operation, due to compliance with socio-environmental sustainability parameters, such as low-carbon agriculture, water supply, or use of renewable energy generated on the property.

    These criteria will be part of the Rural Credit and Proagro (Sicor) Operations System and will help financial institutions improve their socio-environmental risk assessment processes. The information related to sustainable operations may be used by other financial institutions, certifiers of sustainable credit securities, rating agencies specialized in ESG criteria, and contracted service providers to audit the adherence of ventures to socio-environmental requirements, to allow the issuance of green bonds. In addition, agricultural policy makers might also use the information to grant additional incentives to sustainable rural enterprises.


    Related Links (in Portuguese)

    Comment Due Date: April 23, 2021

    Keywords: Americas, Brazil, Banking, Sustainable Finance, Rural Credit, Credit Risk, ESG, BCB

    Related Articles

    EBA Launches Stress Tests for Banks, Issues Other Updates

    The European Banking Authority (EBA) launched the 2023 European Union (EU)-wide stress test, published annual reports on minimum requirement for own funds and eligible liabilities (MREL) and high earners with data as of December 2021.

    January 31, 2023 WebPage Regulatory News

    EBA Proposes Standards for IRRBB Reporting Under Basel Framework

    The European Banking Authority (EBA) proposed implementing technical standards on the interest rate risk in the banking book (IRRBB) reporting requirements, with the comment period ending on May 02, 2023.

    January 31, 2023 WebPage Regulatory News

    FED Issues Further Details on Pilot Climate Scenario Analysis Exercise

    The U.S. Federal Reserve Board (FED) set out details of the pilot climate scenario analysis exercise to be conducted among the six largest U.S. bank holding companies.

    January 17, 2023 WebPage Regulatory News

    US Agencies Issue Several Regulatory and Reporting Updates

    The Board of Governors of the Federal Reserve System (FED) adopted the final rule on Adjustable Interest Rate (LIBOR) Act.

    January 04, 2023 WebPage Regulatory News

    ECB Issues Multiple Reports and Regulatory Updates for Banks

    The European Central Bank (ECB) published an updated list of supervised entities, a report on the supervision of less significant institutions (LSIs), a statement on macro-prudential policy.

    January 01, 2023 WebPage Regulatory News

    HKMA Keeps List of D-SIBs Unchanged, Makes Other Announcements

    The Hong Kong Monetary Authority (HKMA) published a circular on the prudential treatment of crypto-asset exposures, an update on the status of transition to new interest rate benchmarks.

    December 30, 2022 WebPage Regulatory News

    EU Issues FAQs on Taxonomy Regulation, Rules Under CRD, FICOD and SFDR

    The European Commission (EC) adopted the standards addressing supervisory reporting of risk concentrations and intra-group transactions, benchmarking of internal approaches, and authorization of credit institutions.

    December 29, 2022 WebPage Regulatory News

    CBIRC Revises Measures on Corporate Governance Supervision

    The China Banking and Insurance Regulatory Commission (CBIRC) issued rules to manage the risk of off-balance sheet business of commercial banks and rules on corporate governance of financial institutions.

    December 29, 2022 WebPage Regulatory News

    HKMA Publications Address Sustainability Issues in Financial Sector

    The Hong Kong Monetary Authority (HKMA) made announcements to address sustainability issues in the financial sector.

    December 23, 2022 WebPage Regulatory News

    EBA Updates Address Basel and NPL Requirements for Banks

    The European Banking Authority (EBA) published regulatory standards on identification of a group of connected clients (GCC) as well as updated the lists of identified financial conglomerates.

    December 22, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8700