EBA launches its monitoring of climate risk in the EU/EEA banking sector

The European Banking Authority (EBA) has published key indicators on climate risk in the EU banking sector based on data from banks’ Pillar 3 ESG disclosures. This new dashboard represents the first step in creating a broader ESG risks monitoring framework and centralizes access to climate risk indicators, enabling better assessment and monitoring of transition and physical climate-related risks. The EBA identified significant EU/EEA banking sector exposure to sectors contributing to climate change, with an average of over 70% exposure in most countries, while physical risk exposure was reported below 30%. The EBA plans to regularly update the indicators and enhance the monitoring framework.