This link between sovereign and bank risk reflected, first and foremost, the perception that the ultimate guarantor of deposits in the banking system is the state. Hence, where perceptions of sovereign creditworthiness diverged, so did confidence in their respective banking systems.
Firstly, we are concerned with the risks to regulated firms' sound functioning, and more broadly, to financial stability, arising from increasingly commonly occurring climate events or from the transition to a sustainable economy. Secondly, we want to ensure that investors are fully informed and in no way misled.