Federal Reserve Board releases summary of the exploratory pilot Climate Scenario Analysis (CSA) exercise that it conducted with six of the nation’s largest banks

Summary:

On May 9, 2024, the Federal Reserve Board released a summary of its exploratory pilot Climate Scenario Analysis (CSA) exercise, conducted with six of the largest US banks. The exercise aimed to assess how banks are utilizing climate scenario analysis to evaluate the resilience of their business models to climate-related financial risks. The participating banks (Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo) employed various approaches to consider different physical and transition risk scenarios, highlighting data gaps and modeling challenges. The exercise, designed to be exploratory and non-capital-consequence-driven, will inform the Board's engagement with participating banks on measuring and managing climate-related financial risks.