"U.S. banks will face pressure to address the financial threats of climate change — including in underserved communities — under two new sweeping regulatory actions.

The actions, unveiled Tuesday by federal banking regulators, aim to accomplish two separate but related goals.

A final rule includes a provision that explicitly incentivizes banks to help “redlined” communities weather climate-fueled disasters, potentially spurring billions of dollars in investment in everything from flood control systems to sea walls. New guidance, meanwhile, sets regulatory expectations for how large banks should measure and address their exposure to climate-related financial risk."

Avery Ellfeldt reports for E&E News October 25, 2023. [2]