The US Federal Reserve (Fed) announced that 6 of the country’s largest banks would participate in the pilot climate scenario analysis study next year.

In the statement made by the Fed, it was noted that the resilience of financial institutions would be evaluated under different hypothetical climate scenarios.

The statement said that the country’s six largest banks would participate in a pilot climate scenario analysis study designed to improve the ability of supervisors and firms to measure and manage climate-related financial risks.

Stating that scenario analysis is a tool for assessing climate-related financial risks, it was stated that the pilot study would not have any capital or audit effects.

In the statement, it was reported that Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, and Wells Fargo are the banks that will participate in the study.

In the statement, it was stated that the pilot study will start at the beginning of 2023 and is expected to be concluded towards the end of the year, and it was noted that the climate scenario analysis would be separate and different from the bank stress tests.

In the statement, it was stated that participating banks would analyze the impact of climate scenarios on specific portfolios and business strategies throughout the study, the analysis will be examined, and companies will be contacted to build capacity to manage climate-related financial risks.

In the Fed’s statement, it was stated that the findings from the study are planned to be published.