Climate Change

ECB report shows Irish banks at high risk from climate change

A comprehensive report from the European Central Bank and the European Systemic Risk Board on the impact of climate change has flagged Ireland’s banks are at risk if biodiversity starts to shrink

The ECB climate report showed that Ireland’s banks have almost 80 per cent of loan exposure to companies located in areas where frequency of flooding more than doubles from every 100 years to up to 50 years, under the most pessimistic climate scenario. Picture: Getty

Falling biodiversity as a result of climate change will hit Ireland’s banking sector particularly hard, according to a new report from the European Central Bank and the European Systemic Risk Board.

The report, which introduces a framework for addressing climate change’s risk to the financial system, found that European banks lend “disproportionately to sectors with high exposure to climate-related risk” with 75 per cent of overall lending going to high-emitting sectors.

The ECB also looked ...