Posted 12/17/2023, 9:00:00 AM
New Bank Capital Rules Could Shift, Raise Cost of Climate Financing
- Wall Street banks warn that new capital requirements (Basel 3 regulations) will make climate financing costlier and alter risk approaches
- Banks will have less money to allocate to green projects under the new rules
- Climate finance may shift from regulated banks to less regulated areas like shadow banking
- Multilateral banks agree that green finance models may need adjusting due to new regulations
- Emerging markets most in need of climate finance may be hit hardest by financiers becoming more risk-averse