On December 8, 2022, the Basel Committee on Banking Supervision (“BCBS”) released guidance to clarify how climate-related financial risks may be captured in existing capital and liquidity requirements for banking organizations (“Climate FAQs”). The Climate FAQs are noteworthy because they indicate that standard setters believe climate-related financial risks should be included in bank capital requirements and begin to define specific obligations for banking organizations.

Continue reading at Mayerbrown.com for an overview of the background on BCBS and climate risk regulation and a discussion of some of the main points from the Climate FAQs.