TOKYO (Reuters) – The Bank of Japan (BOJ) said it will include climate change risks among the key themes in its bank examinations for the year beginning in April, joining major peers in looking more closely at the effects of global warming on financial institutions.
Japan’s central bank said on Tuesday in guidelines for the examinations that it will check financial institutions’ preparations for addressing risks associated with climate change.
“The BOJ will examine the role of climate change issues … and financial institutions’ efforts in these areas,” the BOJ said in the guidelines.
The focus of the examinations will be to exchange views with major banks that are already analysing how their business could be affected by climate risks, a BOJ official told a briefing.
The BOJ conducts hearings and on-site monitoring in voluntary examinations on financial institutions. It does not have regulatory authority, which falls under the Financial Services Agency (FSA). Neither the BOJ nor the FSA stress tests banks on climate risks.
(Reporting by Leika Kihara; Editing by Chang-Ran Kim and Tom Hogue)
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