Climate-related loan restrictions raise concerns – Ohio Ag Net
Senate Republicans recently raised concerns about the Biden administration’s use of the financial regulatory system to force banks and credit unions to mitigate their exposure to climate risks by limiting lending to certain sectors.
In a letter to the president, 11 senators said such efforts “could harm farmers’ and ranchers’ access to capital and jeopardize our nation’s food security.” Two weeks ago, the Securities and Exchange Commission (SEC) proposed regulations requiring publicly traded companies to report their carbon emissions and other climate-related information, including not only their direct greenhouse gas emissions greenhouse gases, but also the GHGs of partner companies, suppliers and distributors.
The National Pork Producers Council is reviewing the SEC’s proposal and expects to submit comments on it. Senate lawmakers pointed out that the Office of the Comptroller of the Currency recently issued draft principles warning banks that “climate-related financial risk” can have “impacts on shareholder expectations, the bank’s reputation and [low- and moderate-income] and other disadvantaged households and communities. The Federal Reserve also reviews environmental issues — which are beyond its statutory authority — and the Commodity Futures Trading Commission has created a climate risk unit to deal with environmental issues, the senators noted.