Investing.com -- The Federal Reserve has informed Wall Street banks that they will not be required to participate in climate stress tests, according to Bloomberg News. The decision affects lenders such as JPMorgan Chase & Co. (NYSE:JPM), Citigroup Inc (NYSE:C)., and Goldman Sachs Group Inc (NYSE:GS)., among others.
These banks will not need to submit data for the Fed’s Climate Scenario Analysis Exercise this year, as the program has been discontinued. The Fed initiated this pilot program two years ago, in 2023, and its results were published last year.
The climate stress tests conducted by the Fed did not have any direct impact on bank capital or supervisory implications. The intention behind these tests was to assist the largest US lenders, including Bank of America Corp (NYSE:BAC)., Wells Fargo (NYSE:WFC) & Co., and Morgan Stanley (NYSE:MS), in identifying and managing financial risks related to climate change. The decision to end the program means these banks will not have to submit data for these tests this year.
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