NYDFS has issued new guidance for banks on climate risk. This follows on initial guidance issued for banks on climate risk in 2020. According to DFS: “A Regulated Organization’s board of directors and management are expected to care for the organization’s operational resilience and safety and soundness on an ongoing basis and with respect to all material risks. Accordingly, DFS expects that a Regulated Organization’s governance framework will ensure that there is a process in place for identifying, measuring, monitoring, and controlling that organization’s financial risks associated with climate change.” Of particular interest to DFS is whether banks can “minimize and affirmatively mitigate adverse impacts on low- and moderate-income communities while managing climate-related financial risks.”
It has been reported that smaller banks are concerned about their ability to meet this guidance.
The guidance may be found here: https://www.dfs.ny.gov/reports_and_publications/press_releases/pr202212201
An American Banker story about concerns raised by small banks is here: https://www.americanbanker.com/news/new-york-regulators-new-climate-guidance-draws-concern-from-small-banks?position=editorial_3&campaignname=AB%20Daily%20Briefing-12222022&utm_source=newsletter&utm_medium=email&utm_campaign=V2_AB_Daily_2021%2B%27-%27%2B12222022&bt_ee=bU3NNsHSDlspWnvUtbDawy%2FbKQGwkwlpKhZEJLB589HQOjtq6IC3H5gtp8pE5YdT&bt_ts=1671714149833