On 6 April 2022, the Dutch Central Bank (De Nederlandsche Bank, DNB) published a news item about the result of its assessment on the identification, measurement and management of climate-related and environmental risk at small and medium-sized Dutch banks.
In November 2020, the European Central Bank (ECB) published the Guide on climate-related and environment risks for banks (the ECB Guide, [link]). The ECB Guide sets out the supervisory expectations with regard to the consideration of climate-related and environmental risks by banks in their business strategy and their governance and risk management frameworks. The ECB Guide is applied by DNB in its prudential supervision of small and medium-sized Dutch banks.
The results of DNB’s assessment show that there are still improvement opportunities when it comes to the identification, measurement and management of climate-related and environmental risk by the banks. None of the banks are able to meet the complete set of supervisory expectations set out in the ECB Guide. DNB considers that the materiality assessments that have been performed are not comprehensive and complete. In addition, DNB deems the quality of the plans to identify, measures and manage climate-related and environmental risks to be inadequate.
DNB states that it in 2022 it will continue to stimulate banks to meet the supervisory expectations set out in the ECB Guide.