Who Is Still Financing the Global Coal Industry?
New Research Reveals Banks and Investors Behind the World’s Worst ClimateOffenders••

Commercial banks channeled US$ 1.5 trillion to the coal industry since 2019.
Financial institutions from the US, China, Japan, India, Canada and the UK are
responsible for over 80% of coal inancing and investment.

Berlin, Germany / February 15th, 2022
Today, Urgewald, Reclaim Finance, 350.org Japan and 25 other NGO partners publishedresearch on the inanciers and investors behind companies on the “Global Coal ExitList” (GCEL). “It’s long been known that the coal industry is the number one driver of ourplanet’s rising temperature. But who is providing the loans, the underwriting services
and the investments that allow these companies to keep on operating? Our researchanswers this question,” says Katrin Ganswindt, head of inancial research at Urgewald.
According to the NGOs’ research, commercial banks channeled over US$ 1.5 trillion to
the coal industry between January 2019 and November 2021. “Our research displays all
corporate lending and underwriting for companies on the GCEL, but excludes green
bonds and inancing that is expressly directed towards non-coal activities,” explains
Ganswindt. The Global Coal Exit List covers 1,032 companies. Their activities range fromcoal mining, trading and transport to the conversion of coal to liquids, the operation ofcoal- ired power stations and the manufacturing of equipment for new coal plants.
“Banks like to argue that they want to help their coal clients transition, but the reality isthat almost none of these companies are transitioning. And they have little incentive to
do so as long as bankers continue writing them blank checks,” says Ganswindt.
The NGOs also examined institutional investors’ exposure to the coal industry, based on
their share and bond holdings in November 2021. “All in all, we identi ied institutional
investments of over US$ 1.2 trillion in the coal industry,” says Yann Louvel, policy analyst
at Reclaim Finance. “It’s absolutely frightening to see that pension funds, assetmanagers, mutual funds and other institutional investors are still betting on coalcompanies in the midst of an existential climate crisis,” he adds.
Top Lenders to the Coal IndustryfffffffBetween January 2019 and November 2021, 376 commercial banks provided US$ 363
billion in loans to the coal industry. But just 12 banks accounted for 48% of total
lending to companies on the GCEL. The top 5 lenders in this “dirty dozen” ranking are
the three Japanese banks Mizuho Financial, Mitsubishi UFJ Financial and SMBC
Group, Barclays from the UK and Citigroup from the US. (A full list with lending
volumes is provided in the annex). Ironically, 10 of the top 12 lenders to the coalindustry (including the ive banks mentioned above) are members of the Net Zero
Banking Alliance. “At the time when it counts most – today – most of these banks are stillchanneling billions of dollars to the coal industry. It is not enough to make net zeropromises for the distant future and only inch towards them reluctantly,” says Eri
Watanabe from 350.org Japan.

Top Underwriters to the Coal Industry
Between January 2019 and November 2021, 484 commercial banks channeled US$ 1.2
trillion to companies on the Global Coal Exit List through underwriting.1“Underwriting now accounts for the lion’s share of capital that banks mobilize for theircoal clients. It’s therefore crucial that the Net Zero Banking Alliance also begins applying
its emission reduction targets to underwriting immediately,” says Louvel.
12 banks account for 39% of total underwriting for the coal industry since 2019. The
three institutions at the top of the NGOs’ “dirty dozen” ranking are the Industrial
Commercial Bank of China, the China International Trust and Investment
Corporation and the Shanghai Pudong Development Bank. The only non-Chinesebank among the top 12 underwriters for the coal industry is JPMorgan Chase from theUS. JPMorgan Chase is not only a member of the Net Zero Banking Alliance; it is also theworld’s 7th largest lender to the coal industry. “JPMorgan Chase’s list of coal clients in
2021 reads like a 'who's who' of the most carbon-heavy companies on theplanet. Despite a new coal policy in 2020, it’s still servicing top carbon polluters like
China Huaneng, Eskom, American Electric Power and Adani,” says Jason Ope a
Disterhoft from Rainforest Action Network.
The Big Picture on Banks“At the end of the day, it doesn’t matter whether banks are supporting the coal industry
by providing loans or by providing underwriting services. Both actions lead to the same
result: Vast amounts of cash are provided to an industry that is our climate’s worstenemy,” says Ganswindt. If lending and underwriting are viewed together, the following
picture emerges: Banks from only 6 countries – China, the US, Japan, India, the UK
and Canada – were responsible for 86% of overall bank inancing for the coalindustry.

1 Underwriting or investment banking refers to the process by which banks raise investment capital forñfcompanies by issuing bonds or shares on their behalf and selling them to investors such as pension funds,insurance companies, mutual funds, etc.

“If banks from these 6 countries continue business as usual, we won’t be able to moveout of coal in time to keep the 1.5°C limit within reach,” warns Ganswindt.
Top Investors in the Coal Industry
While banks play a central role in helping coal companies acquire capital throughunderwriting their share and bond issuances, the ultimate buyers of these securities areinvestors. For November 2021, the NGOs’ research identi ies over 4,900 institutionalinvestors with combined holdings of over US$ 1.2 trillion in the coal industry. The
top two dozen investors account for 46% of this sum. The two largest institutional
investors in the coal industry are the US investment giants BlackRock and Vanguard,
with share and bond holdings of respectively US$ 109 billion and US$ 101 billion. Next inline are the US investment managers Capital Group and State Street and theGovernment Pension Investment Fund of Japan. (A full listing of the top 24
institutional investors is provided in the annex).
“No one should be fooled by BlackRock’s and Vanguard’s membership in the Net Zero
Asset Managers Initiative. These two institutions have more responsibility foraccelerating climate change than any other institutional investor worldwide,” saysLouvel.
The Big Picture on Investors

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When viewed through a country lens, the big picture is remarkably similar to the one
described for banks. Investors from 6 countries account for over 80% of
institutional investments in the coal industry. We even ind the very same countries,albeit in a different order: the US, Japan, India, Canada, the UK and China. The US is theelephant in the room here: With shares and bonds totaling US$ 688 billion, US investors
account for almost 56% of institutional investments in the global coal industry. “While
the governments of the US, Canada and the UK pushed for a rapid coal phase-out inGlasgow, they have taken no steps whatsoever to encourage their own inance industries
to exit coal,” remarks Louvel.

Investments in Coal Developers
For years, UNFCCC, UNEP, the UN Secretary General and even the IEA have warned that
there can be no more investments in new coal plants and new coal mines. “Not investingin companies, which are still actively developing new coal plants, new coal mines orother coal infrastructure should therefore be a no-brainer for climate conscious
investors,” says Ganswindt.
Unfortunately, it’s not: The NGOs’ research identi ied institutional investments of over
US$ 469 billion – 38% of the US$ 1.2 trillion total - in companies that are still developing
new coal assets. The top investor in coal developers is BlackRock with investments ofover US$ 34 billion. The coal plant developers in BlackRock’s portfolio are planning tobuild over 200 GW of new coal- ired capacity, an amount as big as the operating coalplant leets of Russia, Japan, Indonesia, Poland and Germany combined.

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“Despite the lood of net zero alliances and climate ambition statements by inancial
institutions during COP26, the vast majority of investors are still failing to do theobvious: End their support for coal developers and adopt coal exit policies that are inline with the 1.5°C target,” says Louvel.

Conclusion
The NGOs’ research shows that a small number of inancial institutions from a handful ofcountries play an outsized role in keeping the coal industry a loat. A dozen banks
account for 48% of loans to the industry. Two dozen investors account for 46% of
institutional investments in coal companies. “These inancial institutions must comeunder ire from all quarters: civil society organizations, inancial regulators, customers
and progressive investors,” says Ganswindt. “Unless we end inancing of coal, it will endus.”
Rankings of the top dirty dozen lenders, underwriters and investors are in the annex. For
information on all inancial institutions covered by our research as well as a detailed
methodology, visit: https://coalexit.org/ inance-data
For further information, contact:
Ognyan Seizov, Urgewald, +49 (0)30 863 2922 61, ognyan.seizov@urgewald.org

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Yann Louvel, Reclaim Finance, +33-688907868, yann@reclaim inance.org

ANNEX:fff

The inance data, on which this brie ing is based, was compiled by Profundo, a not-forpro it research company based in the Netherlands.