Navigating a New Climate: Assessing Credit Risk and Opportunity in a Changing Climate - Outputs of a Working Group of 16 Banks Piloting the TCFD Recommendations Part 2: Physical Risks and Opportunities

Simple item page
dc.contributor.authorUnited Nations Environment Programme
dc.contributor.organizationEconomy Division
dc.contributor.otherConnell, Richenda
dc.contributor.otherFirth, John
dc.contributor.otherBaglee, Alastair
dc.contributor.otherHaworth, Anna
dc.date.accessioned2020-07-17T12:52:43Z
dc.date.available2020-07-17T12:52:43Z
dc.date.issued2018
dc.descriptionThis report presents the outcomes of a collaborative project in which a group of international banks examined how climate-related physical hazards may influence credit risk and potential financial opportunities within lending portfolios. The document explains the context of growing exposure of economic assets and sectors to climate variability, including extreme weather events, gradual environmental change and related disruptions to production, infrastructure and property. It outlines an analytical framework used by participating banks to assess how these hazards can affect borrower characteristics, operational performance, collateral values and financial indicators relevant to lending decisions. The report describes pilot case studies applied to sectors such as agriculture and real estate to test methods for linking climate impacts with credit metrics including probability of default, loss given default and loan-to-value ratios. It also discusses how geographical exposure, borrower resilience, insurance coverage and adaptation capacity can influence financial risk outcomes. The document further examines data sources, modelling approaches and scenario analysis used to evaluate potential impacts over time. It highlights practical challenges encountered by financial institutions, including limited historical climate data, uncertainty in projections and difficulties integrating environmental risk analysis into existing credit assessment processes, while documenting lessons learned from the pilot exercises.en
dc.formatText
dc.identifier.otherDTI/2185/GE
dc.identifier.urihttps://wedocs.unep.org/handle/20.500.11822/33117
dc.languageEnglish
dc.relation.ispartofUNEP Finance Initiative
dc.rights.accessLevelPublic
dc.subjectcredit
dc.subjectclimate
dc.subjectbank
dc.subjectinsurance
dc.subjectagriculture
dc.subjectgeospatial information management
dc.subjectreal estate investment
dc.subjectChina
dc.subjectcapacity building
dc.subjectcredit policy
dc.subjectenvironmental financing
dc.titleNavigating a New Climate: Assessing Credit Risk and Opportunity in a Changing Climate - Outputs of a Working Group of 16 Banks Piloting the TCFD Recommendations Part 2: Physical Risks and Opportunitiesen
dc.typeCommunication or other resource

Download

Original bundle

Showing 1 - 1 of 1
Thumbnail Image
Name:
NNC.pdf
Size:
1.35 MB
Format:
Adobe Portable Document Format
Description:
English
Download

Collections

Communication materials