The Reserve Bank of India ( RBI) on Wednesday called for setting up of a data repository to monitor climate related risks. The repository named Reserve Bank – Climate Risk Information System (RB-CRIS) which will include a web-based directory and a data portal forming climate related data sets.
“The Reserve Bank – Climate Risk Information System (RB-CRIS) will comprise of two parts. The first part will be a web-based directory, listing various data sources, like meteorological, geospatial, etc. which will be publicly accessible in the RBI website,” RBI Governor Shaktikanta Das said while announcing the monetary policy. “The second part will be a data portal comprising of datasets (processed data in standardised formats).”
The access to this data portal will be made available only to the regulated entities in a phased manner, he said.
The RBI has said that climate change is emerging as one of the significant risks to the financial system.
It is crucial for regulated entities to undertake climate risk assessments for ensuring stability of their balance sheets and that of the financial system, it said.
“Such an assessment requires, among other things, high quality data relating to local climate scenarios, climate forecasts, and emissions,” Das said.
The banking regulator is also said that the available climate related data is characterised by various gaps such as fragmented and varied sources, differing formats, frequencies and units.
In a recent speech, Reserve Bank of India (RBI) deputy governor M Rajeshwar Rao had said climate change has the potential to create shocks to monetary stability, growth, financial stability, and the safety and soundness of regulated entities.
“Climate-related events adversely impact the credit quality and loan-repayment capabilities of the borrowers,” Rao had said in July. “They can wipe out the assets created from institutional finance, thereby impacting the health of financial institutions.”
The RBI is working towards framing a comprehensive ESG policy, incorporating elements of climate sustainability, investment in sovereign green bonds, measuring the impact of climate change on default risk and contingency planning for climate-related extreme events via actuarial analysis.
The banking regulator is also exploring appropriate coverage for green deposits, climate risk-based differential premiums and ex-ante funding needs for climate sustainability.
“The Reserve Bank – Climate Risk Information System (RB-CRIS) will comprise of two parts. The first part will be a web-based directory, listing various data sources, like meteorological, geospatial, etc. which will be publicly accessible in the RBI website,” RBI Governor Shaktikanta Das said while announcing the monetary policy. “The second part will be a data portal comprising of datasets (processed data in standardised formats).”
The access to this data portal will be made available only to the regulated entities in a phased manner, he said.
The RBI has said that climate change is emerging as one of the significant risks to the financial system.
It is crucial for regulated entities to undertake climate risk assessments for ensuring stability of their balance sheets and that of the financial system, it said.
“Such an assessment requires, among other things, high quality data relating to local climate scenarios, climate forecasts, and emissions,” Das said.
The banking regulator is also said that the available climate related data is characterised by various gaps such as fragmented and varied sources, differing formats, frequencies and units.
In a recent speech, Reserve Bank of India (RBI) deputy governor M Rajeshwar Rao had said climate change has the potential to create shocks to monetary stability, growth, financial stability, and the safety and soundness of regulated entities.
“Climate-related events adversely impact the credit quality and loan-repayment capabilities of the borrowers,” Rao had said in July. “They can wipe out the assets created from institutional finance, thereby impacting the health of financial institutions.”
The RBI is working towards framing a comprehensive ESG policy, incorporating elements of climate sustainability, investment in sovereign green bonds, measuring the impact of climate change on default risk and contingency planning for climate-related extreme events via actuarial analysis.
The banking regulator is also exploring appropriate coverage for green deposits, climate risk-based differential premiums and ex-ante funding needs for climate sustainability.
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