ECB Imposes First Climate-Risk Penalty, Ordering Spain's ABANCA to Pay €187,650

The European Central Bank has imposed €187,650 in periodic penalty payments on ABANCA Corporación Bancaria, S.A., the first climate-related penalty disclosed by the ECB. The Spanish lender was found to have failed to reinforce, by the deadline set by supervisors, its identification of the material climate-related and environmental risks it faces, remaining non-compliant for 65 full days in 2024, after a 31 March 2024 deadline set in an ECB decision of 1 December 2023.

The decision was taken on 29 October 2025 and published on 10 November 2025.

MATERIALITY ASSESSMENT

The ECB's case against ABANCA concerned the bank's failure to reinforce, on time, its identification of the climate and environmental risks that are material to its business.

ABANCA's failure to meet the required deadline and its subsequent 65-day period of non-compliance were central factors in the ECB's determination of the penalty. The regulator said it also considered the duration of the breach, the materiality of the lapse, and the bank's average daily turnover at consolidated level when calculating the final sanction. The penalty took the form of periodic penalty payments, accruing over the period of non-compliance rather than as a single lump sum.

The bank may challenge the decision before the Court of Justice of the European Union.

FIRST CLIMATE-RELATED PENALTY

The action is the first climate-related periodic penalty disclosed by the ECB. The ECB had repeatedly warned that it would escalate where banks were slow to address climate-related risks.

The ECB has published detailed expectations on climate and environmental risk management since 2020, including a guide that sets out how banks should embed physical and transition risk considerations into their credit risk frameworks, stress testing, and internal capital assessments.