FDIC Seeks Comments on Risk Management of Climate Change

The FDIC is seeking comments on draft principles aimed at large financial institutions, defined as those that have over $100 billion in total consolidated assets.

The draft principles would:

• provide a "framework for safe and sound management of climate-related financial risk exposure";
• be "consistent with the risk management framework described in existing FDIC rules and guidance";
• "support efforts by large financial institutions to focus on the key aspects of climate risk management";
• help financial institution management "make progress toward answering key questions on climate exposures and incorporating climate-related financial risks into financial institutions' risk management frameworks";
• support the use of "scenario analysis . . . for identifying, measuring, and managing climate-related risks"; and
• provide "risk assessment processes related to credit, liquidity, operational, legal and compliance and other financial and nonfinancial risks."

Comments are due within 60 days after the date of publication in the Federal Register.