ECB imposes €7.6m penalty on Crédit Agricole for insufficient climate risk assessments
The European Central Bank has penalised French lender Crédit Agricole, S.A. for insufficient climate risk assessment. The ECB says the €7,551,050 penalty was linked to a 75-day period in 2024 during which the bank failed to comply with an ECB directive.
In February 2024, the ECB directed Crédit Agricole to conduct a materiality assessment of its climate risk exposure. The deadline for compliance was set for 31 May 2024.
“Crédit Agricole failed to meet the materiality assessment requirement for 75 full days in 2024”, the ECB noted in a statement.
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The ECB’s supervision of climate risk management in the banking sector follows an escalation process – including the potential use of penalties to incentivise compliance.
Crédit Agricole’s infringement, the ECB says, was temporary yet material. In its view, the non-compliance with ECB’s directive prevented the bank from appropriately identifying its climate risk exposure.
The directive in question was a requirement to measure the materiality of climate risk at department-level and for a specific portfolio of activities.
A spokesperson for Crédit Agricole said the decision relates solely to its response time.
“Crédit Agricole acknowledges the ECB's decision and can only express its lack of understanding regarding a purely administrative penalty”, a spokesperson told Net Zero Investor.
Crédit Agricole says the requirement was granular, specific and linked to a challenging timeframe and the ECB acknowledged it as such.
“This risk is non-material at the Crédit Agricole group level, and responding to the ECB at the requested level of granularity required extensive work which, despite the strong mobilization of teams, could not be completed within the timeframe imposed by the ECB”, the spokesperson added.
At the group level, Crédit Agricole stressed that climate risks are being identified and incorporated into models.
Additionally, the spokesperson noted, “this decision does not concern, in any way, its [group] commitments and concrete actions in favour of climate and energy transition”.
