March 18, 2020
Rainforest Action Network
Oil Change International
New Report Reveals Japanese Megabanks Funneled $282 Billion into Fossil Fuels Since Paris Climate Agreement
MUFG & Mizuho Rank Among World’s Top Ten Fossil Banks
March 18, 2020 — The latest version of the most comprehensive report on global banks’ fossil fuel financing, Banking on Climate Change 2020 (1), was released today, revealing that 35 global banks – including the three Japanese megabanks – have not only been sustaining but expanding the fossil fuel sector with more than $2.7 trillion in the four years since the Paris Climate Agreement was adopted in December 2015. Financial support for the fossil fuel industry has increased every year since 2015, in direct opposition to the UN IPCC recommendations on limiting warming to below 1.5ºC and averting the worst consequences of the climate crisis.
Mitsubishi UFJ Financial Group (MUFG), the worst banker of fossil fuels in Japan, provided $119 billion in fossil fuel financing since December 2015 and was closely followed by Mizuho Financial Group (Mizuho) with $103 billion. SMBC Group provided $60 billion. (2) Roughly a third of this financing went to the top 100 companies expanding fossil fuels. (3)
“Since the ink dried on the historic Paris Climate Agreement, the top three Japanese banks, Mitsubishi UFJ (MUFG), Mizuho and SMBC Group, have wasted a colossal US$282 billion on fossil fuels. MUFG and Mizuho alone spent over US$9 billion on the very top global coal power producers. Unless swift and urgent action is taken, the megabanks should expect more protests, climate risk-focused shareholder resolutions and international criticism which will tarnish reputations and undermine their customer base as climate concerns intensify,” said Hana Heineken, Senior Campaigner at Rainforest Action Network.
In addition to these findings, the report assessed banks’ overall future-facing policies regarding fossil fuels and their policies and practices around financing certain key fossil fuel subsectors. (4) All three megabanks were among the worst performers, with little to no commitment to stop financing fossil fuel expansion. Mizuho and SMBC are Gold Sponsors for the sustainability-touting Tokyo 2020 Olympics
“Despite the megabanks’ recent endorsement of the UN Principles for Responsible Banking, the megabanks’ policies lag far behind their international peers and are completely inadequate for addressing the climate crisis. Coal is no longer economically viable, and the megabanks’ are risking their reputation and profitability by continuing to finance coal and other fossil fuels,” said Eri Watanabe, Japan Campaigner for 350.org.
Dallas Goldtooth, Keep It In the Ground Campaign Organizer, Indigenous Environmental Network
“From the Amazon to the Arctic— these global banks’ social licenses to operate are tainted with the debris of climate chaos and Indigenous rights violations. These banks must be held accountable for the destruction of Mother Earth and Indigenous lifeways. The time has long passed for banks to take corrective action –– they must divest from fossil fuels now.”
Kimiko Hirata, International Director, Kiko Network
“Japanese banks are lagging behind in combating climate change and are failing to address the risks. That’s why we, as a shareholder of Mizuho Financial Group, have asked Mizuho to disclose a plan outlining its business strategy for aligning the bank’s financing with the Paris Agreement. Continued financing of fossil fuels will put Japanese banks and our planet at very serious risk. Banks have an important responsibility to explain how they will avoid such risks.”
Hanna Hakko, Energy Campaigner, Greenpeace Japan
“Financial institutions have a huge power and responsibility regarding the global economy. Up until now the Japanese megabanks have used that power to enable the use of fossil fuels. It is time these banks took responsibility and started shifting money from coal to decarbonisation. MUFG, Mizuho and SMBC have to quickly adopt new energy financing policies if they want to be seen as part of the climate solution, rather than financiers of the climate emergency.”
Note from Report Authors Regarding COVID-19:
The organizations authoring the latest edition of this annual report want to acknowledge the extraordinary circumstances of this moment, given the terrible impacts of COVID-19 on lives, health, and livelihoods for people around the world. As we write, the urgent need to respond to the pandemic and resultant economic impact is rightly taking priority, and may do so for some time. However, climate change remains an existential threat. When we are able to refocus on the climate crisis, we believe that the data and analysis in this report will prove useful in addressing that threat with the seriousness that it deserves.
Notes to Editors:
- Banking on Climate Change 2020, released by Rainforest Action Network, BankTrack, Indigenous Environmental Network, Oil Change International, Reclaim Finance, and the Sierra Club, and endorsed by over 250 organizations from 45 countries around the world, adds up lending and underwriting to 2,100 companies across the coal, oil and gas sectors globally over the period 2016-2019.
- Among the 35 banks assessed, MUFG was ranked the #6 largest fossil fuel bank, followed by Mizuho at #9 and SMBC Group at #20. From 2018 to 2019, Mizuho and SMBC Group significantly increased their financing of fossil fuels, by 10% and 27% respectively, while MUFG decreased by only 5%. JPMorgan Chase was the #1 fossil fuel bank in the world, having provided $269 billion between 2016-2019.
- MUFG, Mizuho and SMBC Group provided $40 billion, $34 billion and $25 billion, respectively, towards fossil fuel expansion. Funding for fossil fuel expansion was measured by aggregating lending and underwriting to 100 companies aggressively planning new coal, oil, and gas extraction and related infrastructure.
- All three megabanks feature prominently among global financiers of the top 30~40 companies involved in tar sands, Arctic oil & gas, offshore oil & gas, fracked oil & gas, LNG import/export, coal mining and coal power. All three megabanks are major global financiers of LNG and Arctic oil & gas, while MUFG and Mizuho are also significant financiers of coal power and fracked oil & gas. MUFG is among the leading banks financing Enbridge’s Line 3 tar sands pipeline and faces fierce opposition from Indigenous communities.