Featured Product

    BCB Adds Sustainability Dimension to Its Agenda in September 2020

    September 12, 2020

    BCB added sustainability dimension to its agenda in September 2020. The new dimension aims to promote sustainable finance, management of socio-environmental and climatic risks in the national financial system, and integration of sustainable variables in the decision-making process. The key measures included in the sustainability dimension are related to supervision, regulation, partnerships, and socio-environmental responsibility. The BCB president also signed a memorandum of understanding with the Climate Bonds Initiative (CBI); the partnership aims to exchange information on the promotion of sustainable finance and management of socio-environmental and climatic risks in the financial sector.

    The sustainability dimension of the Agenda involves the following key measures:

    • Structuring and broadening of the scope for collecting information on socio-environmental risks. This involves creation of document to collect qualitative data on both socio-environmental responsibility and climate risk assessment carried out by financial institutions for selected operations. It also involves automation of crossing exposure data with public information related to socio-environmental risk. 
    • Monitoring of climate risks and stress tests. This involves inclusion of climate risk scenarios in new and improved stress tests performed by BCB, in line with international recommendations and best practices.
    • Regulatory enhancement of Resolution No. 4.327/2014. This involves inclusion of the concept climate risk, improvement of the definition of socio-environmental risk, and inclusion of requirements applicable to all types of risk such as risk appetite statement, stress tests, and business continuity and governance plan. 
    • Better transparency based on Task Force on Climate-related Financial Disclosures (TCFD) recommendations. Improvement of criteria for climate-related financial disclosures by financial institutions, focusing on the risks and opportunities related to climate-related issues, as well as studying specific aspect of TCFD recommendations that can be incorporated into the prudential regulatory framework of BCB.
    • Creation of a "green liquidity facility." This involves a feasibility study, analysis, and subsequent implementation of new facilities for financial institutions, whose collaterals can be private credit operations or private securities. 
    • Management of international reserves. This covers inclusion of sustainability criteria for the selection of counterparties in the management of international reserves and for investment decisions.
    • Joining of the Network for Greening the Financial System (NGFS). BCB joined NGFS to benefit from the exchange of experiences and best practices of central banks about socio-environmental issues, improvement in data analysis and mitigation of socio-environmental risks in the financial system, and strengthening of partnerships with other central banks and international organizations.

    Related Links (in Portuguese)

    Keywords: Americas, Brazil, Banking, ESG, Climate Change Risk, Climate Change Initiative, Climate Bonds Initiative, Stress Testing, NGFS, Sustainable Finance, Disclosures, TCFD, BCB

    Featured Experts
    Related Articles
    News

    EBA Clarifies Use of COVID-19-Impacted Data for IRB Credit Risk Models

    The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.

    June 21, 2022 WebPage Regulatory News
    News

    EP Reaches Agreement on Corporate Sustainability Reporting Directive

    The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).

    June 21, 2022 WebPage Regulatory News
    News

    PRA Consults on Model Risk Management Principles for Banks

    The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.

    June 21, 2022 WebPage Regulatory News
    News

    EC Regulation Amends Standards for Calculating Credit Risk Adjustments

    The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.

    June 21, 2022 WebPage Regulatory News
    News

    BIS Hub Updates Work Program for 2022, Announces New Projects

    The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.

    June 17, 2022 WebPage Regulatory News
    News

    EIOPA Issues Cyber Underwriting Proposal, Statement on Open Insurance

    The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.

    June 17, 2022 WebPage Regulatory News
    News

    US Senate Members Seek Details on SEC Proposed Climate Disclosure Rule

    Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)

    June 16, 2022 WebPage Regulatory News
    News

    EIOPA Consults on Review of Securitization Framework in Solvency II

    The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.

    June 16, 2022 WebPage Regulatory News
    News

    UK Authorities Issue Regulatory and Reporting Updates for Banks

    The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.

    June 15, 2022 WebPage Regulatory News
    News

    BCBS Issues Climate Risk Principles while HKMA Expresses Its Support

    The Basel Committee on Banking Supervision (BCBS) issued principles for the effective management and supervision of climate-related financial risks.

    June 15, 2022 WebPage Regulatory News
    RESULTS 1 - 10 OF 8280