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(Bloomberg) -- Europe’s top banking watchdog will become more powerful as European Union lawmakers expand its remit to include risks linked to climate change and the rise of digital assets.

As sweeping update of regulation detailed this week mandates the European Central Bank to monitor how lenders plan to transition to a net-zero carbon economy over the next three decades. The reform also puts it in charge of supervising bank-owned providers of crypto asset services.

The ECB gets those responsibilities after it built up credibility during the decade that it has been the EU’s main banking regulator. The institution has already been more forceful than the US Federal Reserve in pushing lenders to deal with losses they face from extreme weather or the prospect of borrowers with high carbon footprints going out of business. 

Now the ECB will be more explicitly empowered to intervene in cases where it finds that the way a bank manages climate or environmental risks is deficient, potentially creating a threat to financial stability. That also means it should act “when there are risks arising from transition trends toward” the climate targets within the EU, according to the text of the provisional agreement between the European Parliament and Council of the EU, which still needs to be formally confirmed.

The expansion of powers may help ease tensions between European banking regulators on how hard the ECB should push lenders on climate. Some officials on its supervisory board have been wary that doing so too forcefully would exceed its mandate, Bloomberg reported last year.

Read More: ECB Splinters Over Right to Police Banks’ Path to Net-Zero

The agreed reform also ensures that the ECB can supervise banks’ crypto asset service provider units by adopting a wider definition of what should be included in its oversight. That move was requested last month by the ECB’s departing head of banking supervision, Andrea Enria, as a “matter of urgency.”

The new remit comes as lenders are shedding their initial wariness toward crypto assets including Bitcoin, which was driven by the associated risks and potential for money laundering. Instead, many are now seeking to engage in custody and other related businesses for the asset class. 

Read More: Banks’ Crypto Businesses Shouldn’t Escape Scrutiny, Enria Says

The EU will also gave the ECB the power to oversee operational leasing businesses owned by banks, which can be a way for companies to rent assets without adding them to their balance sheets. The central bank already has responsibility to monitor banks’ financial leasing arms.

Those businesses haven’t been at the forefront of regulatory scrutiny in recent years. Yet the ECB has pointed to challenges at individual firms, such as an IT integration at Societe Generale SA’s Leaseplan business, according to the company.

Read More: SocGen Leasing Chief Blindsided as IT Costs Rose After Deal

By contrast, lawmakers watered down international standards for bank capital that were drafted as a response to the 2008 credit crunch. Changes to laws governing the vetting process for senior bank leadership also didn’t go as far as the central bank had wanted.