The HKMA has released guidelines for the second round of the climate risk stress test (CRST) to authorized institutions (AIs). The CRST has been enhanced to provide a more comprehensive assessment of AIs’ exposure to climate risks and improve their capabilities in managing them. The second round includes a new 5-year scenario, broader scenario variables, and detailed reporting standards. Participating AIs are required to follow a specified approach in segmenting their exposures and assume a static balance sheet in the assessment. The CRST will take place from June 2023 to June 2024, aligning with the HKMA’s stress testing programme and reducing reporting burdens. The HKMA encourages AIs to participate and will provide additional guidance throughout the process.