The Federal Reserve Board of Governors announced that six of the nation’s largest banks will take part in a process to examine economic risks posed by climate change.
The central bank, clarifying that no regulatory implications are linked to the pilot program, said that the exercise will use scenario analysis to “assess climate-related financial risks.” Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo will participate in the initiative.
“The pilot exercise will be launched in early 2023 and is expected to conclude around the end of the year. At the beginning of the exercise, the Board will publish details of the climate, economic, and financial variables that make up the climate scenario narratives,” a statement from the Federal Reserve explained.
