WASHINGTON - The federal agency overseeing America's largest banks has hired its first climate cop.
The Office of the Comptroller of the Currency (OCC) announced on Monday that Dr Yue Chen would be the agency's chief climate risk officer. Dr Chen will focus on developing a new system to assess climate-driven risks to banks, and figure out how to monitor and manage them, the agency said in a statement.
Climate change, including global warming and increasingly severe and unpredictable weather events, makes it harder for banks to figure out how much money to lend to real estate and business deals, and how to price those loans.
Advocates of climate-driven financial oversight say a catastrophic weather event that causes larger-than-expected losses to banks can threaten the stability of the financial system.
The move to integrate concerns about climate change into financial regulation has been largely driven by Democratic lawmakers, who have for years been warning about the dangers that climate change poses to markets.
At the beginning of his term, United States President Joe Biden assembled an expansive team of climate experts inside the White House.
Last year, the OCC designated one of its bank supervisors to serve as a climate risk officer to urge banks to consider climate risks in their daily operations. Dr Chen's role is an expansion of that. She will oversee the regulator's office of climate risk and report directly to the OCC's leader.
The agency is run by Mr Michael Hsu, the acting comptroller.
Dr Chen, known as Nina, has a doctorate in chemical engineering from the Massachusetts Institute of Technology.
She worked at Goldman Sachs in the Wall Street giant's asset management business and at the Royal Bank of Canada before becoming the New York director of conservation investments for the Nature Conservancy, an environmental non-profit organisation, in a job that involved marshalling private funds to help expand the group's work.
The OCC post is not Dr Chen's first role as a regulator, either; she was recently in charge of a newly created climate division at New York state's financial regulator.
"We are fortunate to have someone with her background and experience in both finance and climate-related financial risk," Mr Hsu said in the statement. NYTIMES