Modelling of the impact of physical and transition risks on the solvency of banks
ASSOCIATED TO THE AREA OF EXCELLENCE
RISK & FINANCE
RISK & FINANCE
WHAT DO WE FOCUS ON?
Banks must henceforth be able to demonstrate that they comply with ESG requirements so as to guide the transition towards a more “sustainable” finance, in which supporting the energy transition represents a crucial challenge. This implies evaluating the future of local economic networks and of the assets value, as well as anticipating the impacts of the transition to a low-carbon economy. Financial players thus work to rapidly implement internal mechanisms necessary to monitor such risks and their mitigation, which in fact cover three types of risks: physical, transition and liability. Our research work aims to develop innovative statistical and mathematical models contributing to modelling the impact of climate and transition risks on the solvency of banks and quantifying the capital needs required to cover the risks induced by climate change.
Guillaume FLAMENT (PhD Student)
After graduating from ENSAI in 2020 and completing an MSc in fundamental mathematics in partnership with the University of Rennes and the ENS, Guillaume joined the Square Research Center to carry out his PhD work in the framework of a CIFRE Contract. Deeply conscious of the challenges resulting from climate change, he puts his mathematical skills to the service of a better understanding of the modelling of such challenges, so as to contribute to making the transition towards sustainable finance more feasible and better manage the climate and transition risks. As a researcher associated to the Research Center in economy and statistics (Centre de recherche en économie et statistique, Crest), he participates in seminars and research papers.