The baseline assessment would include the environmental risk of a bank’s lending and other businesses. In this Phase, the HKMA will need to work with the industry to develop a ___ (a) common framework, drawing on the latest international standards and best practices. The HKMA will also, in collaboration with the relevant international bodies, such as the International Finance Corporation (IFC), provide capacity building and training programmes to banks in Hong Kong for better understanding of the green principles and methodology in undertaking the baseline assessment. Phase II – once we have completed the baseline assessment of banks in Hong Kong in Phase I, the HKMA will engage the industry and other relevant stakeholders in a 1/3  BIS central bankers' speeches  (b) consultation on the supervisory expectation or requirement on Green and Sustainable Banking going forward. The key objective of this Phase is to set tangible deliverables for Hong Kong’s banking industry to become “greener” and “more sustainable”. Phase III – once the deliverables have been set, the next Phase is Implementation, (c) Monitoring and Evaluation. The success of this Phase depends crucially on appropriate measurement of the “greenness” of the banks and the timely disclosure of progress or the lack of it. 4. With the support of the banking industry, I expect Phase I could be completed within around 12 months’ time from now. Responsible Investment 5. In the past few years, there has been a significant shift in mind-set amongst asset owners on Green and ESG investments.
The US central bank, the Federal Reserve (the Fed), and the European Central Bank (ECB) took action in this situation by lending large volumes of money to the banks when they could not borrow from one another. The degree of financial unease then varied during the course of a whole year. The TED spreads peaked when the banks wanted to secure their liquidity ahead of the turn of the year 2007-2008. A further peak was reached in March 2008 when US investment bank Bear Sterns suffered acute liquidity problems and suspended payments, but things calmed down again after the Fed mediated the takeover of the bank by JP Morgan. BIS Review 25/2009  1  In mid-September 2008, when the US investment bank Lehman Brothers filed for bankruptcy, the financial turmoil became an acute financial crisis. The TED spreads were driven up to very high levels. Many banks, institutions and funds were highly exposed to Lehman Brothers. Few had expected such an important financial agent to be allowed to fall. There was a great deal of concern that more players would end up in a similar situation. The remaining large investment banks as such quickly disappeared. The financial crisis also spread to other countries and developed into a global financial crisis. Access to credit declined on the financial markets around the world and some markets more or less ceased functioning.