Barclays Plc has increased its review process to better detect client exposure to flood risk, according to Amit Puri, the bank’s head of sustainability for business. The move comes as the bank runs internal models to track scenarios where flood risk is higher, reflecting a response to more severe flooding threats in the UK. The Bank of England’s Prudential Regulation Authority has issued guidelines pressuring banks to analyse climate-related risks more closely, including flooding and storms.
A recent Barclays survey of 700 UK business leaders found 86% have faced difficulty obtaining climate-risk insurance, and half have redirected capital away from areas at higher risk of extreme weather. In real estate and housing, over 40% of firms have shifted investment towards resilience, while more than half would invest further if they had better information on business benefits. Flood risk now tops the list of climate factors influencing business location decisions.
UK banks face mounting demands to show they understand climate risks, particularly as the Flood Re reinsurance scheme, which helps high-risk homeowners access insurance, is due to end in 2039 and excludes homes built after 2009. The urgency to protect assets from climate impacts is growing as physical risks materialise sooner than expected, according to Puri.
