Sunday, February 28, 2016

Australia's Biggest Banks Pump Billions into Fossil Fuels Despite Climate Pledges

The big four banks have lent six times as much to fossil fuels as they did to renewables since 2008. (Photo Credit: Jesse Marlow) Click to Enlarge.
Australia’s big four banks are continuing to finance fossil fuel projects despite embracing a 2C or better global warming target, according to figures from financial activists Market Forces.

The Commonwealth, Westpac, ANZ and National Australia Bank signed off on loans totalling $5.5bn to coal, oil, gas and liquefied natural gas projects in 2015, a figure that is higher than three of the preceding eight years.

Among the deals were eight loans for coal projects signed in Australia in 2015, with a total value of $4bn, including for struggling Whitehaven Coal, operator of the controversial Maules Creek mine. All of the projects had some financing from the big four banks, with their contributions totalling $995m.
Tim Buckley, an analyst from the Institute for Energy Economics and Financial Analysis, told Guardian Australia the banks immediately started trading the debt in secondary markets and lost 20% on it in the first few months.

Buckley said the bad performance of that loan was an “a-ha moment” for the banking industry.  He said he was sure that next year similar analysis would show a drop in fossil fuel lending but not because of environmental concerns – simply because they are realizing fossil fuels are a bad bet.

“The financial markets have realised that [the Paris accord] was a massive aha-moment for everyone … They are saying, ‘Look, we know that policy action globally is inevitable,” Buckley said.  As a result they were beginning to be more cautious about financing fossil fuels and that would be reflected at the end of this year, he said.

Read more at Australia's Biggest Banks Pump Billions into Fossil Fuels Despite Climate Pledges

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