A top Federal Reserve official issued a stark warning on Thursday morning: Banks and other lenders need to prepare themselves for the realities of a world racked by climate change, and regulators must play a key role in ensuring that they do.
“Climate change is already imposing substantial economic costs and is projected to have a profound effect on the economy at home and abroad,” Lael Brainard, one of the central bank’s six Washington-based governors, said at an Institute of International Finance event.
“Financial institutions that do not put in place frameworks to measure, monitor and manage climate-related risks could face outsized losses on climate-sensitive assets caused by environmental shifts, by a disorderly transition to a low-carbon economy or by a combination of both,” she continued.
The grim backdrop to her comments is the abnormally cold weather walloping Texas — leaving millions without electricity and underlining the fact that state and local authorities in…
— to www.nytimes.com