US: Bank of America to shun coal to reduce risks of high carbon investments
Date: 7 May 2015
Bank of America has said that it will reduce its financial exposure to coal companies based on an assessment of the risk to such investments from future regulation and competition from lower carbon natural gas. The announcement is the latest development in the continuing progress of the fossil fuel divestment campaign that has seen a growing focus on the possibility that current oil and coal reserves might come to be 'stranded assets' of no financial value.
Andrew Plepler, head of corporate social responsibility with Bank of America, said that the new policy reflected the company's intent to reduce its credit exposure over time to coal mining globally and to transition to sources of low carbon energy. The company has confirmed that the policy change was influenced by engagement with universities and environmental groups.
Bank of America has historically been one of the biggest supporters of the coal industry, supplying it with $1.3bn of finance in 2014.
The Rainforest Action Network, which has actively lobbied the company over recent years, hailed the announcement as a "sea change." It went on: "Today's announcement … acknowledges the responsibility that the financial sector bears for supporting and profiting from the fossil fuel industry and the climate chaos it has caused."
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