November 28, 2018 Read More →

French banks to be required to stop lending to coal projects

S&P Global Market Intelligence ($):

France will force its financial institutions to stop financing coal mines and coal-fired power stations if they do not stop that kind of lending voluntarily.

Bruno Le Maire told a climate conference in Paris that he would meet banks, insurers and asset managers in the coming weeks and ask them to undertake new commitments to end the financing of highly polluting industries such as coal. These commitments would be checked and the results made public, he said in a speech at the UN Environment Programme Finance Initiative 2018 roundtable. If they are not met, they will be made binding.

Friends of the Earth France on Nov. 26 published a report criticizing the major French lenders —BNP Paribas SA, Société Générale SA, Natixis and Crédit Agricole SA— for financing companies developing coal projects. It said the four banks have provided more than €10 billion to companies involved in coal and coal-fired power station projects since the 2015 Paris agreement on climate change, a 52% increase compared to the three years prior to the accord.

Nevertheless, French banks are widely regarded as having taken the lead among European lenders to combat climate change. A ranking by ShareAction in November 2017 had BNP Paribas as the leader in managing climate-related risks, with Crédit Agricole and SocGen among the top five.

In 2015, Natixis said it would end the financing of coal-fired power stations and thermal coal mining projects worldwide. BNP Paribas, SocGen and Crédit Agricole have also said they would end their financing of coal mining projects.

More ($): France to force banks to end coal financing if they do not stop voluntarily

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