The EBA consults on draft templates and template guidance to prepare its one-off Fit-for-55 climate risk scenario analysis

The European Banking Authority (EBA) launched today a public consultation on draft templates for collecting climate related data from EU banks. This effort is part of the one-off Fit-for-55 climate risk scenario analysis, which the EBA will carry out together with the other European Supervisory Authorities (ESAs) and with the support of the European Central Bank (ECB) and the European Systemic Risk Board (ESRB). The draft templates are accompanied by a template guidance, which includes definitions and rules for compiling the templates. The consultation runs until 11 October 2023.

The draft templates are designed to collect climate-related and financial information on credit risk, market and real estate risks. Banks are asked to report aggregated and counterparty level data as of December 2022. Collecting counterparty level data will allow to assess concentration risk of large climate exposures, as well as to capture amplification mechanisms and assess second round effects. Aggregated data will inform on the climate-related risks of the banking sector more broadly.

Consultation process

Comments to this consultation can be sent to the EBA by clicking on the "send your comments" button on the consultation page. Please note that the deadline for the submission of comments is 11 October 2023.

A public hearing will be organised in the form of a workshop on 28 September 2023. The EBA will share the dial-in details with interested stakeholders in due course.

Next steps

Following this consultation, the EBA will launch a data collection at the end of November with the support of the Single Supervisory Mechanism (SSM) and other competent authorities.

70 banks will take part in this exercise (same banks as those included in the 2023 EU-wide stress test). In addition, Competent authorities might request other banks in their respective jurisdictions to participate.

The one-off Fit-for-55 climate risk scenario analysis is expected to start by the end of 2023, with publication of results envisaged by Q1 2025.

Legal basis and background

On 6 July 2021, the European Commission announced its Strategy for Financing the Transition to a Sustainable Economy. In this strategy, the Commission laid out its plans for ensuring the resilience of the financial sector to climate risks and an orderly transition towards the EU’s climate targets of reaching carbon neutrality by 2050 and reducing greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels.

As part of the Strategy, the Commission announced future work for the EBA on climate stress testing including a one-off Fit-for-55 climate risk scenario analysis. 

On 8 March 2023, the EBA, the ECB and the other ESAs received a letter from the Commission detailing the mandate of the one-off exercise, which aims to:

•  assess the resilience of the financial sector in line with the Fit-for-55 package.
• gain insights into the capacity of the financial system to support the transition to a lower carbon economy even under conditions of stress.

As a first step, the exercise requires each ESA, with the support of the ECB, if needed, to produce sector-specific results, based on three ad-hoc climate scenarios (i.e., one baseline and two adverse scenarios) implemented by the ESRB. These results will then be used by the ECB to produce cross-sectoral results and to model second round effects.