BAnks

What is the role of banks in climate chaos?

Banks supply fossil fuel companies with the cash, credit, cover and counseling to sustain and grow their operations. Banks directly lend huge amounts of money to fossil fuel companies through term loans and credit facilities that those companies can draw on to cover their business costs, whether that’s building a new pipeline or developing a new oilfield. They provide crucial intermediary services, such as underwriting new company stock and bond issuances. Banks also rake in millions for facilitating mergers and acquisitions within the fossil fuel industry. Banks often finance the fossil fuel industry using the cash deposits of everyday people.

They employ vast teams of lobbyists and hold cozy relationships to political officials to maintain their interests and squash pro-climate shareholder proposals and legislation.

The top four financiers of fossil fuels from 2016 to 2022 are all powerhouse U.S. banks: JPMorgan Chase, Citi, Wells Fargo, and Bank of America. Together, during those years, these four banks alone have financed the industry to the tune of a whopping $1.36 trillion.

Often overlooked, big banks are playing an increasing role in facilitating bonds issued by fossil fuel corporations looking to fund their operations. An estimated 50% of all oil, gas and coal financing is in the form of bond issuances, with Citi, JP Morgan, Bank of America and Barclays leading the pack.

Want a deeper dive?

Read “The Big Bank Power Structure and How It Finances Climate Destruction” — a primer on the banks that are financing the fossil fuel industry and how they wield power and influence.