ABBL Webinar – Outcomes of the CSSF self-assessment exercise on Climate-related and Environmental Risks

Over 400 participants attended our webinar on 20 June dedicated to the outcomes of the CSSF self-assessment exercise on Climate-related and Environmental Risks, organised in collaboration with the CSSF.

Two years after the publication of CSSF Circular 21/773, raising banks’ awareness on the need to consider and to assess CRE risks, the webinar provided a first assessment of how banks meet the 19 expectations expressed by the CSSF in the circular.

First part of the webinar

During the first part of the webinar, the CSSF explained how banks’ practices align with CSSF expectations, mapped against the adequacy of their plans to advance those practices. The CSSF also provided very useful examples of good practices identified notably in terms of risk identification and materiality assessment, business strategy and risk appetite and of internal governance. Regarding the next steps, the CSSF informed that the self-assessment exercise will be extended to 14 additional banks to be informed soon. Finally, the CSSF made it clear that a comprehensive action plan approved by the Management Body and a sound materiality assessment must be place by December 2023. The CSSF expects the full implementation of its expectations by December 2024.

Second part of the webinar

During the second part of the webinar, the CSSF responded 16 questions asked by the ABBL in relation to the Circular, on the following topics:

• Scope of application
• Identification of risk exposure
• Business strategy & Risk appetite
• Risk management framework
• Supervisory priorities

The session proved to be helpful by giving a practical view of the CSSF expectations regarding CRE risks: in this area as in many others, the ABBL is convinced that the quality of the supervisory dialogue with the CSSF brings value to our financial community.

The recording of the webinar and the supporting presentations will be sent to registered participants, and they will be made available soon on the ABBL and the CSSF websites. Stay tuned!