Of 638 banks examined, only around 140 have significantly reduced their support forcoal industry since 2016 compared to 75 which increased it, the rest of the sample remaining stable, according to the study by the German NGO published with more than a dozen partner organizations. It comes as the G7 countries meeting in Italy decided at the end of April to gradually phase out coal-fired power plants without carbon capture devices by 2035.
THE commercial banks are not yet reducing their exposure to the coal sector at the rate that would be necessary to achieve the objective arising from the Paris agreement to limit the increase in temperature to 1.5°C, according to Urgewald. In 2023, these establishments have financed coal companies for nearly 136 billion dollars (127 billion euros), only 20% less than in 2016, according to the study.
More than 90% of financing – syndicated loans or fundraising assistance on capital markets – comes from banks located in China, the United States, Japan, Canada, India, Great Britain and Indonesia.
Growing pressure from investors in Europe
Support in particular from American banks, Bank of America and JP Morgan in the lead, increased by 22% between 2021 and 2023, reaching 19.8 billion dollars (18.5 billion euros) last year, when Europe dropped its total by 51% over the same period, to 6.5 billion dollars (6.1 billion euros) in 2023.
The largest coal financiers in Europe are Britain’s Barclays, Switzerland’s UBS, France’s BNP Paribas and Germany’s Deutsche Bank, according to the document. Banks in the eurozone are under increasing pressure from investors, politicians and supervisors due to their exposure to polluting sectors.
In January, the European Central Bank said most major banks under its supervision had not yet brought their credit policies into line with the Paris climate agreement, exposing themselves to high transition risks.
With AFP.
