In light of the Conference on Sustainable Finance, to be held today, 22 March 2018, in Brussels, the French Banking Federation (FBF) and the Italian Banking Association (ABI) express their joint support for the European Commission's action plan and underline their strong commitment to the energy transition. In particular, this should involve the introduction, in the prudential regulation, of a new innovative tool: the “Green Supporting Factor (GSF)”.
The European Commission's Sustainable Finance Action Plan, the most ambitious ever considered to date in Europe, sets a real roadmap and sets out a series of initiatives targeting the financial sector, introducing a framework of incentives to finance and invest in favor of sustainable development in Europe.
With the hope of accelerating the commitment to the energy transition, the FBF and the ABI jointly supported the introduction of a GSF at the Italo-French Economic Forum on 24 and 25 January 2018 in Rome. This incentive mechanism, by reducing the capital requirement on “green” financing, should accelerate climate investments and reduce balance sheet risks. Currently under discussion in the context of the revision of the European rules on capital requirements in the banking sector, it is included in the action plan of the European Commission.
This proposal represents a positive and effective incentive for banking operators to better track their green assets and amplify their commitments. In a context of global increase in capital requirements, it is an important signal to successfully limit the impact of climate change.
According to Marie-Anne Barbat-Layani, CEO of the FBF, and Giovanni Sabatini, Director General of ABI: "Following the One Planet Summit, the action plan of the European Commission for sustainable finance, and in particular the GSF, these are some of the combined initiatives that will enable a real reorientation of capital flows towards a more sustainable and inclusive economy, allowing for alignment with the objectives of the Paris Agreement. ".