![]() Powell has increasingly embraced the shift.Īt his confirmation hearing in January, Powell said, “Our role on climate change is a limited one but it is an important one, and it is to assure that the banking institutions that we regulate understand their risks and can manage them.”Įnvironmental advocates argue that climate change clearly fits in the Fed’s legal mandate to ensure the “safety and soundness” of the financial system. ![]() The rising profile of climate change as an issue for the Fed to consider reflects the growing pressure on the central bank to address issues that traditionally have been outside its purview of keeping unemployment low and prices stable. Pat Toomey of Pennsylvania, the senior Republican on the committee, echoed these concerns in a letter to Biden in which he asserted that Raskin “has also advocated for the Federal Reserve to pressure banks into choking off credit to traditional energy companies.”Ī White House official, who insisted on anonymity to discuss the administration’s views, disputed Toomey’s characterization and said Bloom Raskin is “firmly opposed to the Federal Reserve allocating credit by sector or choking off sectors from access to credit.” Bloom Raskin has been outspoken in her belief that climate change poses risks to the economy and the financial system and that regulators should factor those risks into their oversight. What many in the oil and gas industry fear is something more far-reaching: That the Fed may eventually take steps to discourage banks from lending to energy companies - what they say would be an unprecedented move to disadvantage a specific industry.Ī host of trade associations and business groups have written to the Senate Banking Committee in advance of the hearing, expressing concern about the nomination of Bloom Raskin to be the Fed’s vice chair of supervision, the board member who leads its regulation of banks. The Fed is already moving toward analyzing the risks that banks face from rising temperatures and changing weather patterns. WASHINGTON (AP) - How far the Federal Reserve can go to compel banks to consider the consequences of climate change in their lending policies could take center stage at a Senate hearing Thursday on the nominations of Sarah Bloom Raskin and two economists to the Fed’s influential Board of Governors. ![]() Please look at the time stamp on the story to see when it was last updated. ![]() This is an archived article and the information in the article may be outdated. ![]()
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