Climate Change May Trigger Next Financial Crisis, Fisher Says

* Sterling’s drop shows possibility of fast asset repricing
* Businesses should expect more regulation due to climate change

Climate change could spark the world’s next financial crisis, according to Paul Fisher, who retired this year as deputy head of the Bank of England body which supervises the country’s banks.

“It is potentially a systemic risk,” Fisher said Monday in an interview in Sydney.  A sudden repricing of assets as a result of climate change “could be the trigger for the next financial crisis,” he added.

Fisher, a 26-year-veteran of the U.K. central bank, pointed to the renewed fall in sterling earlier this month, after the government set out a timetable for leaving the European Union, as an example of the way that prices can shift suddenly.  “That is exactly the sort of event you might get with climate change,” said Fisher, formerly deputy head of the U.K.’s Prudential Regulation Authority.

Signs that governments are growing increasingly serious about tackling climate change suggest that businesses need to be ready for greater regulation, Fisher said.

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