Over five years after the Paris Agreement, the UK financial sector is actively undermining Government efforts to phase out coal, according to a new report from NGO Reclaim Finance.

The group’s research, undertaken in collaboration with German NGO Urgewald, has found that five leading UK banks provided $56bn of support to companies on the Global Coal Exit List (GCEL) between October 2018 and October 2020. The five banks are Barclays, HSBC, Standard Chartered, NatWest and Lloyds Banking Group.

Investors led by Legal & General (L&G) likewise held $47bn in GCEL companies in January 2021. Worse still, the report unveils widespread support for companies planning on expanding coal among UK banks and investors.

An under pressure Barclays over fossil fuel financing ahead of its AGM, tops the list of coal-supporting UK banks, with over $27bn of lending and underwriting to GCEL companies over the last two years, placing it in the top 10 globally. HSBC is also singled out for criticism, having funnelled over $15bn into coal companies in two years, including ongoing direct support for coal infrastructure in Bangladesh.

Commenting on the report’s findings, Lucie Pinson, founder and executive director of Reclaim Finance, remarked: “This report shows a tale of two cities. While in Paris banks and investors cleaned up their act on coal after COP21, the City of London isn’t lifting a finger to end its deadly coal addiction, even if that means wrecking the UK’s reputation on climate. On the international stage the UK Government has sought to lead a global exit from coal, but the financial sector clearly hasn’t got the memo.”

All banks and the majority of investors included within the report have joined a net-zero initiative, including Barclays and HSBC joining the new Net-Zero Banking Alliance earlier this month. Yet the report calls into question the impact of these initiatives, given that not a single bank or investor meets the criteria of a robust coal policy, according to the campaigners.

Entitled City of Coal: the Climate Crimes of UK Finance, the report is published by Reclaim Finance, drawing on research with German NGO Urgewald, who partner the report.

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