Principles for Climate-Related Financial Risk Management for Large Financial Institutions

Published on:
June 3, 2022
Submitted to:
FDIC
Submitted by:
SIFMA and ISDA
File Number:
3064-ZA32

Summary

SIFMA and ISDA provided comments to the Federal Deposit Insurance Company (the FDIC) request for feedback on the Principles for Climate-Related Financial Risk Management for Large Banks published in Federal Register on April 4, 2022.

Excerpt

June 3, 2022

By electronic submission

James P. Sheesley

Assistant Executive Secretary

Attention: Comments—RIN 3064–ZA32

Federal Deposit Insurance Corporation

550 17th Street NW

Washington, DC 20429

Re: Principles for Climate-Related Financial Risk Management for Large Financial Institutions (RIN 3064-ZA32)

Ladies and Gentlemen:

The International Swaps and Derivatives Association, Inc. and Securities Industry and Financial Markets Association (collectively, the “Associations”)1 appreciate the opportunity to provide input on the Federal Deposit Insurance Company (the “FDIC”) request for feedback on the Principles for Climate-Related Financial Risk Management for Large Banks (“Principles”) published in Federal Register on April 4, 2022.2

We note that the FDIC’s proposed principles align closely with the proposed climate-related financial risk principles of the Office of the Comptroller (“OCC”).3 With a few exceptions that are set forth below, our comments on the proposed principles mirror the comments we provided in response to the OCC’s proposal.4

The Associations support both the FDIC’s and OCC’s (collectively, “agencies”) goal to enhance the safe and sound management of banks’ exposures to climate-related financial risks. Given the intensifying pace of climate change, it is important to have a continuous dialogue with banking regulators to develop and determine the best approach to the treatment of climate-related financial risks.

We welcome the agencies’ principles-based approach to addressing risk management practices related to climate risk. We support public sector efforts to establish regulatory

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1 Please see Appendix for information regarding each Association.

2 87 Fed. Reg. 19507 (April 4, 2022).

3 https://www.occ.gov/news-issuances/bulletins/2021/bulletin-2021-62.html

4 https://www.isda.org/2022/02/14/response-to-occ-on-principles-for-climate-related-financial-risk-management/

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