In an excellent and detailed article, Lex in the Financial Times highlights the substantial financial risk of stranded assets in carbon based fuels, estimated at over USD 900 billion. Although the focus of the article is more from an equity investment perspective, it provides a very useful context for banks to look at their exposures as well. Mark Carney, Governor of the Bank of England, has been noting this point for some time and has been encouraging banks to look at the risks on their balance sheets. His thoughts are usefully summarised in a Guardian article at the end of last year. Is your bank looking at this risk in its portfolio?
