Climate Change-Related Disasters ‘Not Very’ Impactful on Bank Financial Stability: New York Fed

Contact Your Elected Officials
The Epoch Times Header

A new study from the New York Federal Reserve examining the impact of climate change via extreme weather events on bank financial stability throws cold water on the heated rhetoric around climate change, finding that the threat to banks from natural disasters is trivial while suggesting that a bigger danger to financial institutions comes from policies meant to shield them from such risks.

The Fed report sought to gauge how banks fared against past disasters by examining FEMA-level disasters between 1995 and 2018 and county-level property damage estimates from SHELDUS (Spatial Hazard Events and Losses Database for the United States). The authors concluded the impact was insignificant.

“Not very,” the three authors of the study wrote, positing an answer to the question posed in the title of the report: “How Bad Are Weather Disasters for Banks?”

“We find that weather disasters over the last quarter century had insignificant or small effects on U.S. banks’ performance,” the authors wrote, adding that the stability seems more to do with the intrinsic resilience of financial institutions than any federal aid they may have received in response to extreme weather events.

Profit-Boosting Impact of Disasters

For bigger banks, it turns out that disasters increased loan demand and actually boosted profits, the study says.

“Losses at larger (multi-county) banks are barely affected and their income increases significantly with exposure,” the authors wrote.

Local banks, too, demonstrated resilience to extreme weather events, although the study found they did experience more negative stability impacts from extreme disasters.

“Local banks tend to avoid mortgage lending where floods are more common than official flood maps would predict, suggesting that local knowledge may also mitigate disaster impacts,” the authors wrote.

But even though local banks are more prone to suffering instability impacts from disasters, these were not found to have been significant enough to threaten bank solvency.

“In particular, loan losses and default risk at local banks do not increase significantly,” the authors wrote. “Charge-offs at multi-county banks increase but the impact is very small. Moreover, not all effects are bad; income of multi-county banks increase significantly with disaster exposure.”

By Tom Ozimek

Read Full Article on TheEpochTimes.com

The Epoch Times
The Epoch Timeshttps://www.theepochtimes.com/
Tired of biased news? The Epoch Times is truthful, factual news that other media outlets don't report. No spin. No agenda. Just honest journalism like it used to be.

CHARLIE KIRK, YOU WEREN’T PROVED WRONG

"I want to be remembered for courage for my faith,” Kirk had said in a podcast merely two months ago. May his courage spur us to be bolder in our faith.

Trump’s Proposal For NATO To Stop Buying Russian Oil & Start Tariffing China Is Unrealistic

Trump proposed on social media that NATO stop buying Russian oil and start tariffing China 50-100% as part of his plan for ending the Ukrainian Conflict.

The Choices We Make

Death and disagreement are inevitable. Love and hate are choices. We will all die. Before we do, what choices will we make?

Elon Musk Speaks at Unite the Kingdom Rally

Tommy Robinson held rally, with Elon Musk appearing virtually, calling attention to leftist politicians who allow foreign immigrants to invade England.

Doxed Democrats Are Getting Fired Left and Left

Not a misprint because a title of “left and...

Shares of Intel Increase 30 Percent on $5 Billion Nvidia Investment

Shares of Intel increased by about 30 percent at the opening bell after Nvidia announced a $5 billion investment in the struggling chipmaker on Sept. 18.

Kennedy Lauds McDonald’s Initiative to Invest $200 Million in Regenerative Agriculture

HHS Sec. RFK Jr. announced McDonald’s will invest $200M over 7 years to advance sustainable and regenerative agriculture practices.

Federal Judge Blocks Deportation of Unaccompanied Guatemalan Children

A federal district judge formally blocked the DHS from deporting a group of Guatemalan children who entered the US illegally and without parents.

EPA Flags Silicone Chemical D4 as Risk to Humans, Wildlife

U.S. regulators warn D4, used in silicone products from solar panels to cosmetics, may harm women’s fertility and damage wildlife on land and in water.

Trump, Starmer Seal Record $340 Billion ‘Tech Prosperity Deal’

President Trump and British PM Keir Starmer announced a new partnership worth $340 billion in technology, nuclear power, and private equity.

Rubio Says US Visa Revocations Underway After Charlie Kirk Death Celebrations

SoS Marco Rubio said foreign nationals who made celebratory comments over Charlie Kirk’s assassination will have their U.S. visas revoked.

Trump Supports Designating Antifa a Terrorist Organization

President Trump said he would support designating the antifa movement a terrorist organization in the wake of Charlie Kirk’s assassination last week.

US Conducts Strike on Another Drug Boat From Venezuela: Trump

Three people were killed in a U.S. strike on a Venezuelan drug boat, President Donald Trump announced on Sept. 15.
spot_img

Related Articles

Popular Categories

MAGA Business Central