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ECB to Avoid Climate Laggards’ Longer Debt in Historic Tilt

  • Poor rankings to mean longer-term debt purchases are limited
  • Central banks pressured to do more amid rising temperatures
The European Central Bank headquarters in Frankfurt, Germany.

The European Central Bank headquarters in Frankfurt, Germany.

Photographer: Alex Kraus/Bloomberg
Updated on

The European Central Bank will limit purchases of longer-term debt issued by companies that rank poorly under a new scoring system created to screen out polluters and tackle climate change.

The maturity limit will cut the “longer-term exposure of the Eurosystem to transition risks,” according to a statement Monday. The ECB will also give “special treatment” to green bonds meeting “stringent” requirements and buy more securities from high scorers.