Banks’ exposure to carbon-intensive sectors raises long-term credit risk, costs: IIM Lucknow study

Banks financing carbon-heavy industries face growing credit risks. Research from IIM Lucknow shows this exposure leads to higher monitoring and recovery costs over time. Financial institutions must align lending with a low-carbon economy. Stronger capital buffers help banks manage these climate-related risks. Transitioning to greener portfolios benefits both the environment and business.

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