(29 Apr 2025, 14:23)

Climate change would lead to additional operational costs for the borrowers says RBI Deputy Governor

Climate change risks impact the financial institutions, financial system and real economy through the traditional risk categories and one risk factor that prominently stands out is credit risk, stated M. Rajeshwar Rao, Deputy Governor, Reserve Bank of India in a latest speech. He noted that climate change would lead to additional operational costs for the borrowers with an increased possibility of loss of their assets, leading to increased probability of default by the borrowers. The real economy is also impacted through various means such as direct property losses, crop losses, loss of employment and livelihood losses. Another facet of credit risk in climate change emanates from the need to promote green and sustainable financing. The fact that the net-zero technologies driving the transition to decarbonisation, are at various developmental and evolving stages, itself signifies a significant increase in credit risks. A delicate balancing act needs to be performed by the regulators to avoid any imbalance from the broader financial stability perspective.

More News

(10 May 2025 16:15)
Reliance Power reports turnaround Q4 numbers
(10 May 2025 15:58)
Monsoon likely to reach Kerala on May 27: IMD
(10 May 2025 15:30)
GRSE Q4 PAT tanks 60% YoY to Rs 363 cr; declares dividend of Rs 5.40/sh
(10 May 2025 15:02)
Bank of India Q4 PAT climbs 82% YoY to Rs 2,626 cr; declares dividend of Rs 4.05/sh

Tweets by CapitalMarket17

Live News

Climate change would lead to additional operational costs for the borrowers says RBI Deputy Governor