In late 2021, Bank Negara Malaysia ("BNM") issued an exposure draft on Climate Risk Management and Scenario Analysis ("Exposure Draft"). The Exposure Draft sought to address the challenges to financial stability posed by climate change by laying out principles and requirements that financial institutions must comply with in its management of climate-related risks.
Since the submission period for feedback to the Exposure Draft has passed, it remains to be seen whether the policy document will come into effect on 1 June 2022 as proposed. There could also be further developments to the policy document following the public feedback, although it is highly likely that the overarching principles are here to stay.
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