June 18, 2020 / 3:08 PM / 21 days ago

BoE to keep Carney's environment focus, Bailey says

LONDON (Reuters) - Bank of England Governor Andrew Bailey said on Thursday he wanted the central bank to retain the focus on the potential financial risks from climate change which his predecessor Mark Carney had promoted.

The BoE has encouraged insurers in particular to look at the risk posed by climate change, and has also warned banks of the dangers of lending to companies whose business models could prove unsustainable as environmental rules change.

Environmental campaigners have criticised the BoE itself for buying corporate bonds issued by companies that cause significant pollution.

Bailey said a BoE review showed the “carbon intensity” of its corporate bond holdings was in line with the market average, but that this level of pollution was not consistent with goals to limit climate change.

“This demonstrates the additional work needed to meet the UK’s goal of net-zero emissions by 2050,” he said in the foreword to a report on the BoE’s environmental impact.

Reporting by David Milliken; editing by Stephen Addison

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