Open letter to Bank of England's Andrew Bailey

The letter argues that the financial system currently supports emissions leading to warming exceeding 4C, posing catastrophic risks to banks and insurers. While acknowledging the Bank of England's existing work on climate risk stress tests and disclosures, the signatories assert these measures are insufficient due to short time horizons and methodological limitations. They propose three specific actions: making climate-related disclosures mandatory, excluding fossil fuel assets (starting with coal) from future bond purchases and collateral frameworks, and adjusting the macroprudential framework to increase capital requirements for high-carbon loans.

• The financial system continues to fund emissions that could lead to global warming exceeding 4C, which threatens the stability of banks and insurers through extreme weather losses and sudden value drops in carbon-exposed firms.
• Existing measures such as climate risk stress tests and disclosures are considered insufficient on their own because of methodological limitations in quantifying risk and the short time horizons of market actors.
• The signatories recommend three specific interventions for the Bank of England: implementing mandatory climate-related disclosures, excluding fossil fuel assets (specifically coal) from bond purchases and collateral, and adjusting the macroprudential framework to reflect the risks of high-carbon loans in capital holdings.

APA

Green Economy Coalition (2020). Open letter to Bank of England's Andrew Bailey. https://www.greeneconomycoalition.org/news-and-resources/open-letter-to-bank-of-englands-andrew-bailey

Chicago

Green Economy Coalition. Open letter to Bank of England's Andrew Bailey. 2020. https://www.greeneconomycoalition.org/news-and-resources/open-letter-to-bank-of-englands-andrew-bailey.

Wikipedia

{{cite press release |author=Green Economy Coalition |title=Open letter to Bank of England's Andrew Bailey |date=4 March 2020 |url=https://www.greeneconomycoalition.org/news-and-resources/open-letter-to-bank-of-englands-andrew-bailey |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@misc{greeneconomycoalition2020open, author = {{Green Economy Coalition}}, title = {{Open letter to Bank of England's Andrew Bailey}}, publisher = {Green Economy Coalition}, year = {2020}, month = mar, url = {https://www.greeneconomycoalition.org/news-and-resources/open-letter-to-bank-of-englands-andrew-bailey}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }