Remarks by OFR Acting Director James Martin to the Financial Stability Oversight Council.
Published: July 28, 2022
As prepared for delivery
WASHINGTON – Thank you, Secretary Yellen.
I am delighted for the opportunity to highlight work the OFR has done to advance one of the FSOC’s climate report recommendations: filling climate-related data and methodological gaps.
Identifying risks to financial stability from climate change is a priority for both the Council and the OFR. Yet climate risk is not easily defined, and its potential risk to the financial system is both difficult to model and to forecast.
To accurately assess this risk, financial regulators will need a unique lens – one where climate and financial data can be combined and analyzed. This requires high-powered computing to ingest large, often complex data sets, as well as advanced statistical software to merge these data to create new vantage points.
The OFR is uniquely positioned to provide these resources to the Council.
To test our capabilities to open our analytic environment to analysts and researchers outside of the OFR, we partnered with our colleagues at the Federal Reserve Board to pilot a collaboration space that could feature both climate data and analytic tools. This project is aptly named the Climate Data and Analytics Hub, or Data Hub.
As of now, this Data Hub provides select staff from the OFR and Federal Reserve System access to climate data – such as data on precipitation, and crop and atmospheric conditions – and provides the tools needed to merge this data with financial data. The Data Hub is also equipped with applications for users to collaborate on their research and share their findings.
This project exemplifies two very important ways the OFR can support the Council – by giving member agencies the ability to utilize OFR’s expertise in data onboarding and by providing access to our high-powered analytical environment—for greater insight into financial stability risks. I am immensely proud of all our staff efforts in contributing to this important work.
Given the keen interest already expressed in the OFR’s Climate Data and Analytics Hub by other Council member agencies, we are actively working to expand access to it.
Thank you, again, for allowing me the opportunity to discuss the OFR’s efforts on behalf of the Council.