OCC Moves Environmental Risks Up the Agenda

The Office of the Comptroller of the Currency (OCC) is acting to push climate change up its internal agenda with the appointment of its first climate change risk officer.

Darrin Benhart, who has worked for the regulator for nearly 30 years, has been named to the newly created role. He was most recently a deputy examiner in charge with specific responsibility for Bank of America, and he has held several senior supervisory roles.

In addition, the OCC also announced that it had joined the Network of Central Banks and Supervisors for Greening the Financial System (NGFS). The NGFS is an international collaboration between central banks and financial regulators that share best practice for encouraging climate-conscious regulation and risk management.

Michael Hsu, acting comptroller at the OCC, said: “Prudently managing climate change risk is a safety and a soundness issue. The changes announced today will enable the agency to be more proactive in accelerating the development and adoption of robust climate change risk management practices, especially at the larger banks.”

On his appointment in May, Hsu stated that climate change and social equity would form a key part of the OCC’s regulatory agenda. He said it would take a “two-pronged approach” to climate change, through learning from and working with others and supporting the “effective climate risk management practices at banks”.

On Benhart’s appointment, Hsu added: “Having Darrin in this newly created position will significantly expand the agency’s capacity to collaborate with stakeholders and to promote improvements in climate change risk management at banks. Darrin brings a wealth of supervisory, policy, and leadership experience to the role.”

Banks have been warned by lawyers and regulators to expect a much higher level of scrutiny on their climate and sustainability activities and credentials.