meta_id 3052824

On April 9, 2026, the Hong Kong Monetary Authority (HKMA) issued guidance on current good practices for integrating climate-related risks into the internal capital adequacy assessment process and capital planning for authorized institutions. The guidance addresses how authorized institutions should incorporate climate-related risk considerations into their Pillar 2 capital adequacy frameworks. This development reflects the HKMA's continued focus on ensuring that banks adequately identify, measure, and manage climate-related financial risks as part of their supervisory review processes. The guidance is applicable to all authorized institutions operating in Hong Kong and forms part of the HKMA's broader green and sustainable banking regulatory framework. The issuance of this guidance follows the HKMA's consultation on the revised Supervisory Review Process module (CA-G-5), which concluded on March 19, 2026. The good practices document provides banks with a framework for assessing how climate risks—including physical and transition risks—should be factored into their capital planning and internal capital adequacy assessment processes. This ensures that institutions maintain sufficient capital buffers to withstand potential climate-related financial impacts. Authorized institutions should review the guidance and assess their current practices against the recommended good practices outlined in the document. The guidance is effective immediately and should inform institutions' ongoing capital adequacy assessments and planning processes going forward. **Reference:** Hong Kong Monetary Authority Banking Regulatory Document Repository: Current Good Practices on Integrating Climate-Related Risks into Internal Capital Adequacy Assessment Process and Capital Planning (April 9, 2026)