(8 December 2021 – United States) After ratifying a milestone pledge by the financial services sector to mitigate climate change, global major Banks are not abandoning carbon emitting customers yet.
Immediately following JPMorgan’s inclusion in Mark Carney’s global alliance to target net-zero emissions from the banking industry, the group has underwritten US$2.5 billion in bond deals for companies such Gazprom and Continental Resources, matching similar commitments from the last five years.
Globally systemic important banks (GSIBs) have been associated with US$250 billion in bond issuance year to date (YTD). This figure matches the average annual fundraising for the industry in 2016 despite the fact that the International Energy Agency suggested the need to cut all funding for new oil and gas to avoid the worst impacts of climate change.
Banks maintain that stranded energy assets are required to reliably transition to new sources of energy. How quickly the world transitions and how fast lenders can assist in financing the transition is crucial for determining how impactful the effects of climate change will be with the world inexorably heading towards a 2.4°C warming by 2100, which is further adding to the pressure the banks face.
“We must act now to scale up clean technologies in all sectors and phase out both coal power and polluting vehicles in the coming decade. Our first goal for the UK as Cop26 presidency is to put the world on a path to driving down emissions, until they reach net zero by the middle of this century” stated President-Designate of COP26 and Former UK Business Secretary, Alok Sharma.