UPDATE 2-Banks gave over $1.5 trillion to coal sector in 2019-21


(Updates with response from Mizuho)

By David Stanway

SHANGHAI, Feb 15 (Reuters) – Financial institutions injected more than $1.5 trillion into the coal industry in the form of loans and subscriptions between January 2019 and November 2021, although many took net zero commitments, according to a report from a group of 28 non-governmental organizations shown.

Reducing coal use is a key part of global efforts to reduce global warming greenhouse gases and get emissions to net zero by mid-century, and governments, businesses and financial institutions around the world have pledged to act.

But banks continue to finance 1,032 companies involved in coal mining, trading, transportation and use, according to the study.

“Banks like to say they want to help their coal customers make the transition, but the reality is that almost none of these companies are making the transition,” said Katrin Ganswind, head of financial research at the within the German environmental group Urgewald, which led the research.

“And they have little incentive to do so as long as the bankers keep writing them blank checks.”

The study says banks in six countries – China, the United States, Japan, India, Britain and Canada – were responsible for 86% of global coal financing during the period.

Direct lending amounted to $373 billion, with Japanese banks Mizuho Financial and Mitsubishi UFJ Financial – both members of the Net Zero Banking Alliance – identified as the two biggest lenders.

Mizuho told Reuters in a statement that the report did not reflect the “actual situation”. He said he further develops sustainability strategies with his clients through services such as transition finance and consultancy.

Mitsubishi UFJ did not immediately respond to requests for comment.

Another $1.2 trillion was funneled to coal companies through underwriting. The top 10 underwriters were Chinese, led by the Industrial and Commercial Bank of China (ICBC) with $57 billion. He did not respond to a request for comment.

Institutional investments in companies still developing coal assets amounted to $469 billion, led by BlackRock with $34 billion.

The US asset manager declined to comment on Tuesday, but chief executive Larry Fink wrote in January that “divesting entire sectors…will not bring the world back to net zero.”

“Foresighted companies across a wide range of carbon-intensive sectors are transforming their businesses, and their actions are a critical part of decarbonization,” he wrote in a letter to fellow CEOs.

BlackRock’s coal-related equity and bond total during the period was $109 billion, according to the NGO’s report.

Comparative coal finance figures for previous years were not immediately available. Other research studies, however, have shown that investment in coal is on the decline.

The coal sector is responsible for nearly half of global greenhouse gas emissions. More than 40 countries pledged to end the use of coal following climate talks in Glasgow in November, although major consumers such as China, India and the United States did not agree. not registered.

But more coal-fired power capacity invested by China overseas has been canceled than commissioned since 2017, according to a study by the Center for Research on Energy and Clean Air (CREA) last June.

Nearly all development funding available internationally is now committed to reducing or ending investment in coal-fired power plants after China and the G20 decided to stop supporting new projects overseas, the report showed. November of research from the Global Development Policy Center at Boston University. (Additional reporting by Zoey Zhang in Shanghai and Yuki Nitta in Tokyo; Editing by Jacqueline Wong, Muralikumar Anantharaman and Jan Harvey)

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