The impact of climate risk on financial stability in CEMAC countries

The impact of climate risk on financial stability in CEMAC countries | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article The impact of climate risk on financial stability in CEMAC countries ENGUENE ANDRE ARNAUD This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-8147988/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract The objective of this article is to analyse the impact of climate risk on macro-financial stability in the CEMAC sub-region, in light of the increase in natural disasters and their effect on growth and the stability of financial systems. The methodology is based on an empirical approach using an autoregressive vector panel over the period 1996 to 2022 for member countries. The study is based in particular on the analysis of impulse response functions based on Monte Carlo simulations to measure the reaction of the financial system to climate shocks, while integrating macroeconomic indicators. The results show that climate risk has a significant and immediate influence on the stability of the financial system, causing lasting reactions in the financial sector. Dependence on hydrocarbons, the intensification of extreme events such as floods and droughts, and the transition to a more sustainable economy increase this vulnerability. These risks lead to asset degradation, increased credit defaults, and a decline in macroeconomic stability, threatening the sub-region's growth and financial stability. In response to these challenges, two main recommendations are made. First, regulatory authorities would benefit from strengthening financial regulation by explicitly incorporating climate risk into banking supervision. Second, regulatory authorities will also need to develop anticipation and adaptation mechanisms to better manage the effects of climate disasters and support a resilient and inclusive economic transition. JEL Codes : F36, G01, Q01, Q54 CEMAC financial regulation climate risk physical and transition risks macro-financial stability Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-8147988","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":554990286,"identity":"70baa6ae-a545-4e12-b198-dc5f0692ba54","order_by":0,"name":"ENGUENE ANDRE 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