EBF RESPONSE

EBF Response to the EBA consultation paper on Climate Scenario Analysis

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Brussels, 15 April 2025 – The European Banking Federation has submitted its response to the European Banking Authority’s (EBA) consultation on the draft Guidelines for ESG Scenario Analysis.

While welcoming the development of supervisory expectations in this evolving area, the EBF emphasizes that key challenges remain—particularly related to data availability, implementation timelines, and the maturity of methodologies. The EBF’s main messages include:

• Postponement of implementation: The EBF calls for deferring the application of both ESG Risk Management and ESG Scenario Analysis Guidelines until the outcome of the Omnibus review. The current January 2026 deadline is seen as premature.
• Climate focus and flexibility: Recognizing climate risk as a developing field, the EBF supports a phased and proportionate approach, with initial efforts concentrated on climate stress testing.
• Proportionality and materiality: ESG scenario analysis should be tailored to institutions’ size, complexity, and risk exposure. Social and governance factors should be included only where materially relevant.
• Climate Resilience Analysis (CRA): CRA should not be embedded in ICAAP and should follow banks’ strategic planning cycles (typically 3–5 years), rather than be conducted annually.
• Scenario design and alignment: The EBF highlights the need for flexibility in developing scenarios and questions the feasibility of aligning with Paris Agreement trajectories given current counterparty emissions trends.
• Persistent data gaps: Inadequate ESG data—especially for SMEs and non-EU entities—remains a significant obstacle. The EBF reiterates its call for regulatory support in facilitating access to reliable data, including the creation of a shared platform.

You can access the full EBF response here.

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About the EBF:

The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from across Europe. The EBF is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere.