illuminem summarizes for you the essential news of the day. Read the full piece on Fortune or enjoy below:

🗞️ Driving the news: A report by First Street highlights that America's small banks face billions in potential losses from climate-related disasters like floods and wildfires
• Nearly one-third of these institutions are unaware of their exposure to this risk, despite increasing climate threats

🔭 The context: Climate-related events could reduce the value of banks' holdings by over 1%, a threshold considered "material" by the SEC
• Small and regional banks are particularly vulnerable, as their portfolios are often concentrated in high-risk areas prone to extreme weather events

🌍 Why it matters for the planet: As climate disasters grow more frequent, banks’ inability to account for climate risk threatens not only their stability but also the broader financial system, potentially worsening economic inequality in affected areas

⏭️ What's next: Regulators like the Federal Reserve and SEC may soon enforce stricter climate risk reporting
• Many banks need to adopt comprehensive risk assessments to withstand future weather-related crises

💬 One quote: "Financial institutions are really the big concern, because if they fail in financial crises, that impacts everyone else," said First Street CEO Matthew Eby

📈 One stat: Climate risks threaten a collective $2.4 billion across nearly 200 U.S. banks

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