The European Central Bank (ECB) has fined ABANCA Corporación Bancaria €187,650 for failing to comply with its decision regarding climate-related and environmental risk management, the ECB announced on Monday.

ECB supervisors have been tightening scrutiny over banks’ exposure to climate risks, moving from setting expectations to issuing binding decisions on how lenders should disclose and manage such risks.

ABANCA failed to meet the materiality assessment requirement for 65 days in 2024, as it did not adequately assess and document the materiality of its climate-related and environmental risks before the specified deadline, according to the ECB.

The bank may challenge the decision before the EU Court of Justice.

This action underscores the ECB’s increasing focus on ensuring that financial institutions integrate climate risk into their governance and risk management frameworks.