Angelovska Bezhoska: Collecting and publishing data on green financing and measures for its encouraging

Skopje, 10 January 2022

Climate changes already have visible effects on the global economy, and thus on the financial sector. Policy makers need to pay larger attention to this issue. The National Bank set the green finances as a strategic objective and is working on devising monetary measures for their encouraging. We are also considering forming a "green" portfolio of the securities in the foreign reserves, and we are also planning guidelines for banks for green financing and stress-testing of banks of the resilience to climate changes. This was emphasized by the Governor of the National Bank, Anita Angelovska Bezhoska, in an interview for "Marili".

"From this year, we will establish a regular system of collecting more detailed data on green financing, and we will alsoconduct a survey that should give an answer for the banks' awareness of the risks from climate changes on their portfolio, the manner of identifying, measuring and managing the risks, as well as whether they plan new products which belong in green finance", says Angelovska Bezhoska.

The Governor adds that on the basis of the analysis, following the European practice,they plan to prepare guidelines for the banks' operations in the field of green finance, including for transparent financing. To assess the resilience of the banking system to climate changes stress-tests are planned, which will require strengthening of the institutional capacity of both the regulator and the banks. Also, we are actively working on devising monetary measures that will encourage green financing, and in the part of the foreign reserves management, we are considering forming a special "green" securities portfolio, says Angelovska Bezhoska.

In her interview, the Governor says that, according to thesurveys conducted in2021, 63% of the central banks consider green finance as part of their mandate, unlike46% in2017.

"Also we, as a central bank, recognizing the risks from climate changes in the long term,we have taken a proactive stand in the society on this issue. From March2021, we became part of the Green Finance Network which is constituted of central banks and supervisory bodies, whereby we are already part of a platform through which we can monitor, but also actively take part in all new international initiatives in this filed", says Angelovska Bezhoska.

Regarding what the banking system can do with respect to the impact of climate changes,the Governor emphasizes that it is key to accurately determine the connection of the financial sector with sustainable and with unsustainable segments in the economy, as well as making efforts for a more dominant "green" component in the finance in the economy.

"This applies to domestic banks, which have a great financial potential, but the share of green loans is still low, or only2.5% of total loans. Around one quarter of these loans are financed through earmarked credit lines from the international financial institutions, which in the coming period can also have an important catalyst role in this segment", says the Governor.

Angelovska Bezhoska points out that there are encouraging data obtained on the basis of information from the latest surveys of the National Bank, according to which around70% of the banks approve loans for projects that have a positive impact on the environment, 43% of the banks have also established a formal system of identification of green projects, and the share of green loans, although small, still grows.

"This shows more developed awareness also with banks of the issue of sustainability, and their increasing orientation toward green finance has a dual role - on the one hand, it improves the structure of the economy as a whole, while on the other, it strengthens the resilience of the banking system to these risks", says the Governor.

Public link

Please use the above public link if you want to share this noodl on another website.