The Thought Lab

The Thought Lab

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Hackathon: How banks can save the world!

January 16 @ 9:30 am - January 17 @ 5:30 pm


Could you help develop a solution to better evaluate risk and assist banks to shift their banking book to contribute to the 600 billion of green investments needed each year to limit global warming well below 2.0 degrees by 2100?


In the paper by Vincinguerra et al (2020), it is illustrated how financial services are at the heart of driving the change to a sustainable economy. Banks work under a very regulated framework and by assuming that the regulator could enforce a partial activity shutdown to limit CO2 emissions, the risk management approach of a bank should provoke the shift of the portfolio without any effective enforcement. Whilst a global Emission Trading Scheme with a carbon tax to avoid free riders has been suggested to be failing, an alternative solution involving leveraging finance power to change and simulate the economy effectively, quickly and globally via green investments has been proposed through the Climate-extended RWA.

What is the Climate Extended RWA?

The objective of a credit risk model is to calculate the unexpected credit loss under a stressed scenario taken at a high level of confidence. The mathematical proposition illustrated in the paper builds on existing regulation and calculations to provide a powerful predictive stress test that helps financial institutions tackle climate change. The three areas covered include: assessing risk as usual, assess the transitional risk to a green economy, and the physical risk.


Overlay economic and environmental data to provide a risk tool using the Climate Extended RWA so Financial institutions can effectively contribute to green investments. Prizes will be awarded for best: Data Science solution, Data Engineering solution, BI solution.

TBC: Economic data, Environmental data, Open Data
More details will be confirmed nearer the time.

Hackathon Agenda
• Saturday 16th Jan, 9.30-10.30am: Adrian Sargent: How banks can save the world with Climate extended RWA
• Saturday 16th Jan, 10.30-11.30am: Data Sponsors talking through economic and environmental data
• Saturday 16th Jan, 11.30-11.45am: The Challenge
• Saturday 16th Jan, 11.45 – 12.00pm: Team Registration
• Saturday 16th Jan, 12pm to Sunday 17th Jan, 3pm: Let’s get hacking
• Sunday 17th Jan, 3-4.30pm: Presentations
• Sunday 17th Jan, 4.45pm- 5pm: Prizes Awarded


January 16 @ 9:30 am
January 17 @ 5:30 pm


Online Event


UK Azure User Group – Meetup

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