Despite acknowledging the need to cut emissions, Canada’s big five banks – RBC, Scotiabank, TD, BMO and CIBC – have increased their support for the fossil fuel sector by 70% in 2021 compared to the previous year . This is what emerges from the latest edition of the report Banking on Climate Chaos, published this Wednesday by a consortium of civil society organizations supported by Greenpeace Canada.
Since the adoption of the Paris Agreement, over the past six years, the financing of fossil fuels by the 60 largest banks in the world has reached 4.6 trillion US dollars in total. Last year alone, the support given by these big banks to the sector reached 742 billion.
The big Canadian banks don’t do well in this global picture. Between 2016 and 2021, they provided support of nearly $700 billion in fossil fuels. By far, the RBC is the one with the worst balance sheet (201 billion in total), followed by Scotiabank (149 billion), TD (141 billion), the Bank of Montreal (117 billion) and CIBC (90 billion). Note that Desjardins is not included in the ranking of major fossil fuel financiers mentioned in the report.
After having all reduced their funding to this sector in 2020, in the midst of the pandemic, they have greatly increased it by 70% in 2021. Since the Paris Agreement, their support for fossil fuels has increased by around 30% .
“It’s completely the opposite of what should be done,” said Keith Stewart, senior energy strategist at Greenpeace Canada. “In the past year, we have seen all the banks commit to achieving carbon neutrality, but when we look at the figures, we can see that they are not changing their practices,” he laments.
“This report proves to us that banks cannot be trusted just on the basis of their good intentions. They will continue to do what is most profitable for them”, adds Mr. Stewart, arguing for better government regulation.
Last week, Senator and environmental expert Rosa Galvez tabled a bill along these lines to force the financial sector to align with Canada’s climate goals.
Canadian banks lead the world
While the major US banks are still among the global leaders of those having allocated the most financing to the fossil fuel sector since the Paris Agreement, Canadian banks also continue to be overrepresented. Three of them – RBC, Scotiabank and TD – are among the top twelve creditors, and five are among the top twenty, accounting for a quarter of this ranking.
The increased support of Canadian banks for the oil sands sector is also particularly alarming, underlines Keith Stewart of Greenpeace Canada. In 2021, funding to this sector worldwide reached US$23.3 billion – a 51% increase over the previous year, particularly encouraged by RBC and TD.
“Big banks are investing heavily in public relations to promote their climate actions, but they better put money into climate solutions,” said Mr. Stewart.