EBA Backs NGFS Energy Transition Declaration
The European Banking Authority welcomed a climate-finance declaration on the macro-financial effects of the energy transition, ahead of planned climate risk testing in 2027.
Updated on Nov. 13, 2026 in Financial Services
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The European Banking Authority welcomed publication of the Network for Greening the Financial System's Declaration on the macro-financial dimension of the energy transition. The declaration was published for the 2026 United Nations Climate Change Conference (COP31) in Antalya, Türkiye.
Why it matters
The declaration highlights that energy price shocks and climate-related shocks are becoming a macro-financial reality for banks and financial systems. The EBA's position signals closer alignment between climate science and banking supervision across the European Union.
The NGFS, launched on 12 December 2017, counted 170 members and observers across five continents by the end of 2025. The EBA has not yet disclosed how climate-risk findings will shape capital requirements under the planned stress test.
The players
European Banking Authority
The EU agency that sets prudential rules and conducts stress tests for banks across the European Union, headquartered in Paris.
Network for Greening the Financial System
A global network of central banks and financial supervisors that works to align financial systems with climate goals, founded in 2017.
The details
The EBA is an active member of the NGFS and has published Guidelines on the management of ESG risks, Guidelines on environmental scenario analysis, and an ESG risk dashboard. On 9 November 2026 the authority announced that the 2027 EU-wide stress test will include a dedicated climate module assessing physical and transition climate risks for the first time.
Timeline
12 December 2017: NGFS launched at the Paris One Planet Summit.
End of 2025: NGFS reached 170 members and observers.
2026: COP31 held in Antalya, Türkiye, where the declaration was published.
9 November 2026: EBA announced the climate module for the 2027 stress test.
2027: EU-wide stress test with its first climate risk module.
Market Landscape
The EBA's move extends the NGFS's climate-finance agenda from voluntary guidance into the EU's formal bank stress-testing regime. It positions European supervisors as early adopters of climate-risk measurement while other jurisdictions remain at the guidance stage.
Banks tested under the 2027 stress test may need to measure exposure to physical and transition climate risks in their lending books. Customers with loans tied to carbon-intensive sectors could eventually see those risks reflected in pricing or credit availability.
The takeaway
Climate risk is moving from a reporting exercise into supervisory testing, so banks and their customers should expect climate exposures to matter more in capital and lending decisions over the coming years.
What happens next
The climate risk module will be run as part of the 2027 EU-wide stress test, the first EBA exercise to assess physical and transition climate risks.
Further reading
For broader context on how regulators are folding climate risk into lending and capital rules, see Financial Services.
Source note: This article includes information reported by European Banking Authority.
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