Bank transition plans (TPs) are becoming vital tools for assessing financial institutions' climate resilience and readiness for a sustainable economy. The EU’s 2024 Capital Requirements Directive 6 mandates that banks develop TPs for prudential oversight, with supervisors required to evaluate them. In response, the European Banking Authority (EBA) has issued guidelines to support banks in structuring these plans. The discussion will explore current gaps in evaluating governance, risk management, and long-term financial resilience related to climate risks, and consider the regulatory frameworks needed to embed TPs into effective prudential supervision.
Moderation: Karsten Neuhoff, DIW Berlin