The Global Risks Alliance (GRA)
Sector-level scenarios for Banking Nexus are published here with their assumptions and limits. They describe aggregate exposures; they are not forecasts and not investment advice.
Fig.A programme from scoping to the owner's decision. Design, not a record.
Banking Nexus sector scenarios are published, aggregated descriptions of how exposures in the financial stability field could evolve under stated assumptions, read against frameworks such as Basel III framework. They describe sector-level exposures with their limits; they are not forecasts, assess no individual firm and are not investment advice.
How physical and transition risk could reach a loan book under different scenarios. Illustrative design values.
Analysis runs in Nexus Foundry; reviewed releases are listed here.
| Exercise type | Horizon | What it tests |
|---|---|---|
| Annual supervisory stress tests (for example the US supervisory stress test or the EBA EU-wide test) | Two to three years | Capital adequacy under macroeconomic severe adverse scenarios |
| Climate exploratory exercises | Long horizon, often to 2050 | Exposure to physical and transition pathways, with management actions |
| NGFS short-term scenarios | Five years | Combined physical and transition shocks with macro-financial variables |
| Operational resilience scenarios | Event-defined | Whether important business services stay within impact tolerance |
Sector scenarios on Banking Nexus join geocoded collateral and borrower sites to hazard layers and NGFS transition variables, then apply illustrative damage and revenue functions to show where probability of default and loss given default would move. Values are design values, not estimates for any bank. The NGFS Phase V physical damage function is under review after the retraction of the paper it relied on, so physical results are shown with that caveat. Methods at GCRI scenario stress.
Each term as this page uses it. Where a standard-setting body defines the term, the wording follows that body.
| Term | Definition |
|---|---|
| Scenario | A plausible description of how the future may unfold under stated assumptions, not a prediction. |
| Severe but plausible scenario | A disruption scenario extreme enough to test resilience yet realistic enough to occur. |
| Reverse stress test | Starting from a failure outcome and identifying the scenarios that would cause it. |
| Investment advice | A personal recommendation on investments, a regulated activity in most jurisdictions. |
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.