Can natural disasters set off a full-fledged banking crisis?
The wildfires in Hawaii this summer, Colorado in 2021, and Oregon in 2020 are bringing home to even die-hard climate change deniers the investment consequences of global warming.
The utilities serving the areas in each case are being sued for not shutting down their power grids during heat waves, contributing to some of the worst blazes in U.S. history.
PacifiCorp alone potentially faces $1 billion in class-action fines for the Oregon fires. Hawaiian Electric Industries’ shares plunged 40% during the fires in Maui.
But there is a sector that’s potentially on the hook for many times the size of those losses. And it’s not on anyone’s sell list—yet.
Banks.