Overview

PACTA for Banks is an open-source climate scenario analysis toolkit that enables banks to assess how well their corporate lending portfolios align with climate scenarios, using physical asset and financial data to inform lending strategies and climate target-setting. It is free to use and designed for climate-aligned financial analysis.

Organisation behind the tool

PACTA for Banks is maintained by the Paris Agreement Capital Transition Assessment (PACTA) team at RMI (formerly Rocky Mountain Institute). It was initially developed through collaboration among financial institutions, academic partners, non-governmental organisations and funders as a public good.

What the tool does

• Measures alignment of corporate lending portfolios with climate scenarios across key climate-relevant sectors and technologies.
• Provides software packages in R for data preparation, matching portfolios to climate data, analysis and visualisation.
• Uses physical asset-level data, financial exposures and scenario pathways to calculate alignment metrics.
• Offers supporting resources such as data templates, loan book guides and methodology documents.
• Produces outputs that can be visualised graphically to show alignment against chosen scenarios.

Target audience

The primary users are banks and other lending institutions seeking to evaluate climate alignment of their loan portfolios. The tool is also relevant to risk analysts, climate finance researchers and regulatory bodies analysing transition risk.

Relevance to finance professionals

• Risk assessment – Helps identify transition risk exposure related to climate change within credit portfolios as banks evaluate their lending strategies.
• ESG analysis – Provides climate alignment metrics that can feed into environmental, social and governance reporting and disclosures.
• Market/commodity insights – Offers sector-level insights for industries such as power, fossil fuels, automotive, steel and cement.
• Investment context – Supports long-term climate strategy development through scenario comparison of corporate clients’ capital stock and plans.