The Global Risks Alliance (GRA)
What readiness means in banking Nexus: the evidence, governance and documentation a programme needs before a competent institution can review it independently.
Mortgage book · Scenario: delayed transition
geocoded collateral · placeholder
| High | 415 | 168 | 85 |
| Medium | 4292 | 128 | 75 |
| Low | 18,747 | 1680 | 59 |
Banking Nexus · Climate risk in the bookClimate risk in the book, in outline: domain structure with placeholder names and illustrative values, not a record.
Readiness in Banking Nexus is the state in which a programme's evidence, governance and documentation let a competent institution review it independently, against frameworks such as Basel III framework and Core Principles for Effective Banking Supervision. A readiness file is released only at the owner's written direction, and GRA does not approve, rate, underwrite, lend or invest.
Fig.A programme from scoping to the owner's decision. Design, not a record.
How physical and transition risk could reach a loan book under different scenarios. Illustrative design values.
A readiness file describes a programme's evidence, risks and governance so that an institution can carry out its own review. GRA does not approve, rate, underwrite, lend or invest, and it recommends no counterparty.
A readiness file arranges this evidence; the lender applies its own rating models, risk appetite and pricing.
| Credit question | Climate or operational evidence that answers it |
|---|---|
| Probability of default over the loan's life | Revenue and cost exposure of the borrower to hazards and transition pathways, by site |
| Loss given default | Collateral location, hazard at relevant return periods, insurance cover on the collateral |
| Concentration | Share of the book in one basin, coastline or supply corridor |
| Tenor and refinancing | Whether hazard or policy change falls inside the loan term or at refinancing |
| Operational continuity | Dependencies of the borrower and the bank on shared infrastructure |
Under the Basel Framework, climate drivers are not a separate capital charge; they enter through credit, market, liquidity and operational risk, as the BCBS 2022 climate principles make explicit. Real-estate risk weights, collateral valuation rules and the output floor determine how a hazard-exposed exposure weighs in capital. EU banks apply the final reforms since January 2025; UK banks from 1 January 2027; the US package was re-proposed in March 2026 and is not final. Evidence on the borrower side comes from GCRI Critical Infrastructure.
A file is released only at the programme owner's written direction, to a party the owner chooses, with no fee tied to any transaction.
Each term as this page uses it. Where a standard-setting body defines the term, the wording follows that body.
| Term | Definition |
|---|---|
| Readiness file | A document set describing a programme's evidence, risks, governance and data so that a competent institution can carry out its own independent review; it is not an approval, rating or offer of finance. |
| Due diligence | The independent investigation a lender or investor carries out before committing finance. |
| Environmental and social safeguards | Requirements lenders set so financed projects avoid, minimise and offset harm to people and the environment. |
| CET1 ratio | Common equity tier 1 capital as a share of risk-weighted assets, the core measure of a bank's loss-absorbing capital. |
The bodies and documents this page is read against. Status and editions change; each link goes to the issuing body.
The current service level is R0: information and enquiries. An enquiry receives a reference and names the next step; applications, payments, compute allocations and registrations open only when their team, terms and review capacity exist.