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Commerzbank to cut ties with fossil-fuel firms

 

Bloomberg

Commerzbank AG is imposing more stringent policies for fossil-fuel clients as pressure mounts on the finance industry to stop providing capital to sectors at the heart of global warming.
The German lender is giving existing clients that get at least 20 percent of revenue or power production from coal until 2025 to spell out how they’ll exit the dirtiest fossil fuel this decade, according to a statement. What’s more, Commerzbank won’t take on new clients with that level of coal exposure or those “planning to
expand oil and gas activities,”
it said.
The new policy comes on the heels of the COP26 climate summit in Glasgow, where the number of banks, investors and insurers committing to net-zero CO2 emissions by mid-century reached 450, representing 40% of the world’s financial assets. Commerzbank used
a recent investor day to promise more sustainability
policies for its lending.
As sentiment shifts, banks across the globe are unveiling stricter lending terms in an effort to decarbornise their books.
But the industry has also shown reluctance to sever ties with long-standing clients. The aim is to “support our clients in their transformation” rather than cut them off, Commerzbank said.
For now, companies producing oil, gas and coal still get ample funding from the finance industry. So far this year, global banks have helped fossil-fuel companies issue almost $250 billion in bonds, broadly in line with the industry’s average annual fund-raising since 2016.

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