Extreme weather events such as floods, droughts and cyclones have placed debt of more than Rs 6.19 trillion ($84 billion) at risk at Indian banks, Bloomberg reported citing the annual report of non-profit CDP.
Among the top 67 Indian companies that responded to CDP, lenders accounted for 87 percent of the total risk, worth around $97 billion, the news website reported.
State Bank of India, HDFC Bank, IndusInd Bank and Axis Bank are among the institutions that reported climate risks to CDP in 2020, the report said.
According to the report, the banks flagged exposure to environmentally sensitive businesses including cement, coal, oil and power, and noted the impact of cyclones and floods on loan repayments in farming and related sectors.
CDP, an environmental disclosure platform, collected the data on behalf of 515 investors with assets worth $106 trillion, and received responses from 220 small and large Indian companies.
"Climate is the biggest risk to businesses in the long run. Financial institutions are beginning to understand it," Damandeep Singh, director of CDP India was quoted as saying by Bloomberg.
"As investors look at funding companies based on environmental, social and governance disclosures, we've seen many more companies report climate change risk," Singh said.