Capital requirements

Capital requirements can be adjusted to reflect the increased risks of different assets, including fossil fuels. They could also be used to steer financing away from particular industries.
Flooding in a street in Steyr, Austria.
News | October 2, 2025

Climate risk buffer needed to mitigate banks’ climate change losses, says nonprofit

It’s been 10 years since Canadian prime minister Mark Carney made his landmark speech on the tragedy of the horizons when he was governor of the Bank of England. Despite increased information and awareness, financial markets have not effectively priced …
Opinion
News | January 13, 2026

China shows monetary independence may hinder net zero progress

Government direction has spurred PBoC to adopt green monetary policy measures, argue economists Mathias Larsen and James Jackson.
News | January 13, 2026

Weak consensus on ‘transition’ activities in Asian taxonomies expose investors to risks

Indonesia, Malaysia, Japan and China are ‘effectively tolerating transition-washing’ in power generation, based on a study by Energy Shift Institute.
Opinion

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Opinion
A man stands in front of machinery at a coal mine. He is barefooted and his clothes are very grimy. The ground is black with coal dust.
News | July 31, 2025

Overdue oversight leaves Indian banks shackled to coal

Despite India’s climate ambitions, its banks are providing billions to the coal industry and the Reserve Bank of India needs to act, says finance analyst Anusha Das of Climate Risk Horizons.
A hand holding a lump of coal with coal mine in the background
News | February 17, 2025

EU insurers must set aside more capital for risky fossil fuel assets, say NGOs

NGOs want the EU to make insurers set aside more capital due to the climate change risk of fossil fuel assets.
A woman wearing a head scarf looks to her right through a pair of binoculars
News | December 19, 2024

What should central banks do to combat climate change in 2025?

Climate experts, economists and campaigners say central bankers should think bigger on fighting climate change in 2025 despite the incoming Trump administration.
Opinion
A suburban street surrounded by floodwaters
News | September 19, 2024

Europe must impose higher capital requirements for insurers’ fossil fuel investments

Increased capital requirements for insurers are needed to reflect the higher risks of fossil fuel assets and maintain financial stability, says Jérôme Crugnola-Humbert, former sustainable finance policy expert at EIOPA.
Hand removes blocks with the word Risk
Research| July 3, 2024

Designing a Macroprudential Capital Buffer for Climate-related Risks

ECB researchers present a detailed methodology for calibrating systemic risk buffers to address climate-related financial risks, bridging a critical gap in research.

Published by European Central Bank

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