Banks continue to fund fossil fuel expansion, new report shows

April 1, 2022|Written by Graham Caswell

A new report from a coalition of civil society groups has documented the extent of fossil fuel financing by the world’s largest banks. It shows that the world’s 60 largest private banks provided USD$742bn in fossil fuel lending during 2021, including $185.5bn to 100 companies which are doing the most to expand the fossil fuel sector.

Endorsed by over 500 organizations from over 50 countries, the 13th annual Banking on Climate Chaos report provides the most comprehensive global analysis on fossil fuel banking to date.

Despite urgent warnings that the world is already experiencing widespread and dangerous water shortages, extreme heat, melting ice caps, wildfires and flooding as a result of human greenhouse gas emissions, the banks profiled in the report continue to finance these emissions, lending $185.5bn in 2021 to the 100 companies doing the most to expand the fossil fuel sector. These banks have lent a total of $4.6tn to the fossil fuel industry since the Paris Agreement was adopted in 2016.

The report also highlights the vast gap between the statements and commitments of major banks and their actions. It includes a timeline showing how banks that have joined the UN-affiliated Net-Zero Banking Alliance (part of the Glasgow Financial Alliance for Net Zero) last year also financed the companies most involved in oil and gas expansion. This risks locking in decades of climate-warming emissions, exposing the banks and the financial system to potential asset stranding and other climate-related transition risks.

Of the 44 banks in the report currently committed to net-zero financed emissions by 2050, 27 still do not have a meaningful no-expansion policy for any part of the fossil fuel industry.

“The data is clear: despite their net-zero pledges and restrictions on fossil fuel financing, banks are still massively supporting oil and gas expansion, at odds with what climate science requires,” said Reclaim Finance director Lucie Pinson. “The war on Ukraine is another stark reminder that oil and gas are at the root of both war and climate change. It’s high time banks close the policy gaps and turn off the taps.”

This page was last updated April 1, 2022

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