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Dear subscriber,
When commercial banks notice that their quarterly earnings are under pressure, they start to pay attention. In the last week, five US banks, including the largest financiers of the fossil fuel industry, reported major problems with their fossil fuel investments. Whilst the banks blame the Covid-19 pandemic for their losses, the truth is that the pandemic has only accelerated the collapse of the fossil fuel industry. This industry was already on the decline. Since 2015, 226 US oil and gas companies have gone bankrupt, primarily due to heavy debt obligations.
Although we are still a long way from banks significantly withdrawing their finance from fossil fuels, some promising new policies are increasingly closing down bank’s finance for the industry. BNP Paribas is expected to adopt a global coal exit policy and Deutsche Bank intends to reduce its finance for coal, oil and gas. In the US, Morgan Stanley, Bank of America and Citi all announced that they would track their greenhouse gas emissions for their loan and investment portfolios as part of the Partnership for Carbon Accounting Financials (PCAF). Whilst measuring and disclosing climate impact is important, the next step must be phasing out funding for fossil fuels entirely.
We still have much more work to do to ensure that banks withdraw their finance from fossil fuels and take responsibility for climate change in the financing of new projects. Just look at the Coastal GasLink pipeline with a syndicated loan of CAD 6.4 billion. Perhaps they'll notice when they do the maths for their next quarterly earnings.
With best wishes,
The BankTrack Team
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Banks in this digest
Bank of America
Barclays
BNP Paribas
Crédit Agricole
Deutsche Bank
Goldman Sachs
HSBC
JPMorgan Chase
Mitsubishi UFJ
Mizuho
Morgan Stanley
SMBC
Société Générale
Unicredit
Wells Fargo
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Fool’s Gold: financial institutions waste billions undermining climate action
Europe Beyond Coal, BankTrack, BlackRock’s Big Problem, Ember, Fundacja "Rozwój TAK - Odkrywki NIE”, Friends of the Earth Finland, Friends of the Earth France, Greenpeace, Reclaim Finance, Re:Common, ShareAction, Urgewald and 350 Japan, July 15
Fool’s Gold - The financial institutions risking our renewable energy future with coal examines eight European, and four significant international, financial institutions with close ties to Europe’s eight most polluting coal companies, finding that all continued to pump money into companies responsible for half of all EU coal-based CO2 emissions in the year after the IPCC released its 1.5 degrees C special report in Oct 2018.
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EPN's pulp & paper policy assessment table launched on BankTrack website
BankTrack, July 23
The In the Red 2020 pulp and paper policy assessment was originally published in March 2020 on the Environmental Paper Network’s (EPN) website. Since then it has been updated to include policy updates made by banks after its release. The report evaluates the investment policies of 68 major financiers of the pulp and paper industry, benchmarking them against 14 absolute minimum criteria Read more...
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Civil Society news on banks
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Deutsche Bank's new policies: much needed movement, still a long way to Paris
Urgewald, July 27
Today, Germany’s largest private bank has published fossil fuel policies to reduce its financial dealings with coal, oil and gas companies. Regine Richter, Energy Campaigner at Urgewald, comments: ''Deutsche Bank seeking to limit its fossil businesses is a much-welcomed step forward. From a climate perspective, however, this is still too little, too late. We would have needed significantly more ambition in the year 2020.'' Read more...
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BNP Paribas close to adopting global coal exit policy
Friends of the Earth France, Reclaim Finance, July 22
BNP Paribas published its financing policy for mining companies and operators of coal-related infrastructure online (1). It goes further than the one published three weeks ago regarding coal-based electricity producers (2) by excluding companies based on strictly defined criteria. Both policies aim to support the exit from thermal coal in EU and OECD countries by 2030 and by 2040 in other countries but are conditional upon their rigorous and proactive Read more...
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Morgan Stanley will be first major US bank to track and report its climate impact
Sierra Club, July 20
Today, in an announcement reported by Politico, Morgan Stanley announced it would become the first major American bank to track and report the greenhouse gas emissions from its loans and investments as part of the bank’s own contribution to climate change by joining the Partnership for Carbon Accounting Financials. From 2016-2019, Morgan Stanley invested more than USD 91 billion in fossil fuels Read more...
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Indigenous Women’s Divestment Delegation pushes Deutsche Bank for fossil fuel divestment amidst pipeline shutdowns, a global pandemic and the climate crisis
Divest Invest Protect & WECAN, July 16
Following recent divestment advancements, a sixth Indigenous Women’s Divestment Delegation— infused with the spirit of their ancestors and unwavering determination to seek accountability and justice— will meet virtually with representatives from Deutsche Bank on July 16th, 2020 Read more...
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Butchering the Planet: the big-name financiers bankrolling livestock corporations and climate change
Feedback Global, July 13
Do the names ‘Tyson’, ‘Smithfield’, or ‘Cargill’ ring a bell? You might have seen these names in the news over the past weeks – recently their meatpacking plants have emerged as some of the world’s largest COVID-19 hotspots, along with prisons. But unless you work for these corporations, live near their industrial farms, or the polluted lagoons they leave behind you’ve likely never Read more...
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Wall Street’s biggest banks back new climate initiative; climate advocates raise questions
Rainforest Action Network, July 9
Four of America’s largest banks, JPMorgan Chase, Wells Fargo, Bank of America and Goldman Sachs, have announced as Founding Partners of the Center for Climate Aligned Finance, a new initiative by the Rocky Mountain Institute. The banks’ involvement seems to be a response to the growing pressure they are facing from climate activists to take responsibility for their substantial role in financing the fossil fuel industry driving the Read more...
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Japan’s big bet on LNG looks increasingly risky
Greig Aitken Global Energy Monitor, July 8
Since 2017 the Japanese government has made public commitments for the country’s financial institutions to back the development of liquefied natural gas (LNG) infrastructure projects globally to the tune of US$20 billion. A new report from Global Energy Monitor (GEM) has found that over the last three and a half years Japanese government agencies and commercial banks have in fact ploughed at least US$23.4 billion into more than 20 LNG terminals, LNG tankers and related pipelines in Read more...
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Could financial sector vigilance have avoided Vizag gas leak?
Guest blog by Shreya Kaushik, Fair Finance India, July 1
A gas leak at the Visakhapatnam factory of LG Polymers India Pvt Ltd (LGPI) on May 7 killed thirteen people and exposed thousands of people living in nearby villages to toxic styrene fumes. The factory had opened in light of the relaxation for industries after the initial phase of the lockdown due to Covid-19. A series of legal actions have been taken since then. On May 8, the National Green Tribunal (NGT) took suo moto cognisance Read more...
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Sombwe Dam
BankTrack, July 21
The proposed Sombwe dam presents unacceptable risks to water, biodiversity, natural habitats and the local livelihoods of thousands of families. Furthermore, the project is illegal due to its location in a Congolese Protected Area. In June 2019, PowerChina and the Congolese company Kipay Investments Sarl signed a joint venture for the construction of the 150 megawatt Sombwe hydropower plant in the DRC. The proposed USD 400 million Sombwe complex includes a dam, reservoir, and road works. The hydropower plant is located inside Upemba National Park Read more...
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Coastal GasLink pipeline
BankTrack, July 7
The Coastal GasLink pipeline is a 670-kilometre pipeline currently under construction in British Columbia, Canada. The pipeline is intended to transport fracked gas from Dawson Creek to Kitimat. From there, LNG Canada will convert the gas into liquefied natural gas (LNG) for export to global markets. The project costs are estimated to be CAD 6.6 billion. The pipeline is expected to start operating in 2023 with an initial capacity of two to three billion cubic feet of gas per day. The pipeline has the capacity to expand to five billion cubic feet of gas per day Read more...
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As the Dakota Access Pipeline shuts down and the Atlantic Coast Gas pipeline goes bust, will banks finally draw the right lessons?
BankTrack, July 7
BankTrack warmly welcomes yesterday’s decision of the U.S. District Court for the District of Columbia ordering the shutdown of the Dakota Access Pipeline. The decision to close the pipeline was made because of the continued absence of an Environmental Impact Statement that addresses the potential risk of oil spills to Lake Oahe in North and South Dakota Read more...
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- How the fossil fuel industry funds the police, July 27, The Huffington Post
- Big US banks say fossil fuel investments are dragging them down, July 23, Bailout Watch
- UK and banking giants spearhead drive to combat nature-related financial risks, July 21, Business Green
- Exclusive: Global banks scrutinize their Hong Kong clients for pro-democracy ties, July 20, Reuters
- European banks accused of propping up coal polluters, July 15, Financial Times
- Principles for Responsible Banking members sign off on delisting mechanism, July 15, Responsible Investor
- Japan vows to slash financing of coal power in developing world, July 13, Financial Times
- Investors and activists push Standard Bank to clean up its climate act, July 1, Daily Maverick
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It's time they start to fund our future
Fund our Future UK, July 15
Fund Our Future is a network of organisations and social movements that work together to have a bigger collective impact on securing a climate safe future for all. We are committed to pressuring the UK’s biggest financial players to align their business practices with a fair and habitable future. Take action...
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