ECB Says 90% of Big Banks Face Elevated Climate Transition Risks

The European Central Bank said about 90% of big lenders it analyzed in the euro area face “elevated transition risks” as the region seeks to zero out carbon dioxide from its economy by mid century.

The banks are notably exposed to energy companies that are “too slow” in phasing out carbon-intensive operations or lagging in increasing renewable energy output, according to an ECB study of 95 lenders covering 75% of loans in the region published on Tuesday.

The ECB has repeatedly said that lenders aren’t doing enough to prepare for the fallout of extreme weather shocks on asset values, or ...