November 25, 2020 Read More →

Trump White House trying to block divestment with new banking rule

DeSmog:

A new proposed regulation that would bar large banks from declining to do business with particular industries or groups of companies was released on Friday by the Treasury Department’s Office of the Comptroller of the Currency (OCC) — a move that could have major implications for a wide array of divestment and boycott campaigns nationwide, including efforts to divest from fossil fuels.

Although framed as an effort to ensure “fair access” for all businesses to major banks, the rule bars big banks from declining to do business with any particular sector or industry. The Trump administration proposal specifically cited efforts by banks to respond to climate change risks or to comply with the Paris Agreement, saying the rule would put those efforts off-limits. 

The Institute for Energy Economics and Financial Analysis lists over 100 banks — both foreign and domestic — that have committed to reducing their exposure to coal and/or to oil and gas. 

“Banks have backed away from fossil fuel lending mostly for reasons that are very easy to quantify: they’ve proven to be terrible investments,” Clark Williams-Derry, an analyst with The Institute for Energy Economics and Financial Analysis, told DeSmog. “Just look at the $170 billion in debt swept into bankruptcy over the past 5 years, at the major write-downs of oil assets that secure bank debt, or at the ongoing chaos in reserve-based lending as companies are forced to downgrade their reserves.”

“In some ways, some banks are getting environmental kudos for doing things that they would have done anyway on purely financial grounds,” Williams-Derry added.

[Sharon Kelly]

More: Trump Administration Targets Banks Divesting From Fossil Fuels In New Anti-Climate Rule

Posted in: IEEFA In the News

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