77. With respect to concentration risk, institutions should consider and manage the risks posed by …

With respect to concentration risk, institutions should consider and manage the risks posed by concentrations of exposures or collateral in single counterparties, interdependent coun-terparties or in certain industries, economic sectors, or geographic regions which may present a higher degree of vulnerability to ESG risks. To identify ESG-related concentration risks, insti-tutions should consider the size and/or shares of their exposures that may be affected by ESG risks relative to total exposures and as a proportion of Tier 1 capital. Institutions should take into account several ESG factors amongst which GHG emissions, sectoral characteristics, vul-nerability of geographical areas to physical risks, and social or governance deficiencies or con-troversies identified in jurisdictions where exposures or collateral are located, as well as the availability of risk mitigating factors. Institutions should assess if and how ESG-related con-centration risk aggravates the prior financial vulnerability of exposures.

1. Overview

1.1 References

1.2 Identified Requirements

1.3 Related Standards

2. Identified Requirements

3. Related Standards

• EBA -

  EN: Guidelines and other publications of the European Banking Authority (EBA), https://www.eba.europa.eu/. © European Banking Authority. Reproduction is authorised provided the source is acknowledged (EBA legal notice). Divided into sections and converted into the GRCA format, the wording unchanged. Only the versions published by the EBA are authoritative.

  DE: Leitlinien und weitere Veröffentlichungen der Europäischen Bankenaufsichtsbehörde (EBA), https://www.eba.europa.eu/. © European Banking Authority. Wiedergabe mit Quellenangabe gestattet (Rechtlicher Hinweis der EBA). In Abschnitte aufgeteilt und in das GRCA-Format umgewandelt, der Wortlaut unverändert. Maßgeblich sind allein die von der EBA veröffentlichten Fassungen.