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Sustainable finance – coming of age

September 2, 2022

Sustainable finance – coming of age

Region:
Europe
EU Monitor
Topic:
Banking and financial markets, Sustainability
Analyst:
Jan Schildbach, Ursula Walther
PDF 293k
For the financial sector, sustainable finance is steadily moving up the priority list. It is about incorporating environmental, social and governance (ESG) considerations into finance. The global volume of ESG-labelled assets grew to USD 35 tr in 2020 and may reach USD 41 tr by the end of this year. Despite strong growth, sustainable finance still faces obstacles such as the absence of a universally accepted definition of ESG and a lack of data on ESG metrics. Regulation is trying to keep pace with market dynamics to facilitate the flow of funds into sustainable activities. Key initiatives include the establishment of taxonomies, disclosure rules and product-related regulation. In the short term, sustainable finance faces headwinds from adverse macroeconomic conditions and emerging regulatory requirements, but the fundamental growth drivers remain intact. [more]
Deutsche Fassung ➜

More documents about "Europe"

217 Documents
    

OTC derivatives trading: First signs of a shift from London towards EU financial centres

March 3, 2023
Region:
Europe
Topic:
Banking and financial markets
Analyst:
Ursula Walther
Chart in Focus
2
London continues to be the leading trading hub for OTC interest rate derivatives with a market share of 46% and an average daily turnover of USD 2.6 tr. However, the UK has lost ground since 2019 when its market share was still 51%. This is due to the transition away from Libor as well as the ongoing efforts of EU authorities to bring more derivatives clearing into the bloc. [more]

Video: Catering for next-gen investors

January 31, 2023
Region:
Europe
Analyst:
Rhea Shah
dbInSights - public
4
In a new video Rhea Shah highlights how European retail online brokerage and platform universe all feature in the ‘European online brokers & platforms: Catering for the next-gen investors’ report. The report aims to making it easier for investors and corporates to compare companies in one place. [more]

Climate stress tests: Are banks fit for the green transition?

January 12, 2023
Region:
Europe
Topic:
Banking and financial markets, Sustainability
Analyst:
Ursula Walther
EU Monitor
6
Climate stress tests have emerged as a key tool for looking into the financial system’s vulnerability to climate risks. Banks’ exposure to climate risks stems from (1) physical risks that are closely related to geography, and (2) transition risks mainly from loans to carbon-intensive sectors. Exercises by the ECB and BoE suggest that banks’ credit losses in a disorderly transition would be higher than in an orderly transition scenario, and even higher in a “hot house world” with unabated global warming. Banks would be able to absorb climate-related losses due to strong capital buffers. Results are subject to data limitations and modelling constraints. So far, climate stress tests are declared learning exercises with no direct implications for capital requirements. However, supervisors are urging banks to set up a comprehensive climate risk management. [more]

Europe finally catching up on the US?

December 20, 2022
Region:
Europe
Topic:
Banking and financial markets
Analyst:
Jan Schildbach
Chart in Focus
7
For more than a decade, European banks have sought to catch up and narrow the gap to their US peers. For many years, they were not particularly successful, due to a number of reasons: economic growth in the US outpaced that in Europe, interest rates were consistently higher (and never negative) on the other side of the Atlantic, and restructuring and capital raising needs were greater in Europe which constrained the banks’ ability to expand their business. In the past few years, however, European banks’ performance has indeed improved and they have not just made substantial progress, but also seem well positioned to finally reduce the distance to their US competitors. [more]

European banks in a sweet spot

November 17, 2022
Region:
Europe
Topic:
Banking and financial markets
Analyst:
Jan Schildbach
Talking Point
10
The European banking sector is currently enjoying a sweet spot. Recent interest rate increases by central banks in most advanced economies combined with strong credit growth are having a pronounced positive impact on revenues, while loan loss provisions remain fairly low so far, although they have started to climb. Bottom line, growth in administrative expenses, individual banks’ tax and litigation payments as well as Russia-related losses have reduced net income, but the industry is still on track for a decent full-year result. More importantly, fundamentally higher-for-longer interest rates may support banks’ business prospects also in the medium term. [more]

Video: Ten Green Bottlenecks

October 14, 2022
Region:
Europe
Analyst:
Adrian Cox
dbInSights - public
11
With all the talk of gas storage at 91%... new LNG terminals … and billions of public money to be spent on renewable energy… you might think Europe is on the brink of ending its dependency on Russian gas and moving to clean energy.
But we see 10 reasons why this will take longer than expected. [more]
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