With a whopping $42.5 billion in financing, one Canadian bank topped the list of global financiers to fossil fuel companies in 2022.
The ranking is compiled each year by a group of international environmental organizations.
The Royal Bank of Canada, RBC, overtook a prominent U.S. financial institution, JP Morgan Chase, for the top spot.
According to the findings, RBC was responsible for $42.5 billion USD in financing towards fossil fuel projects in 2022 alone.
From this amount, the report shows that approximately $4.8 billion went to support oilsands projects and $7.4 to fracking.
The group profiled the top 60 banks, which by assets, provided the most funding to fossil fuel projects worldwide.
The annual assessment aims to shed light on how banks have decided to allocate their financing since 2016, when many countries, including Canada, signed the Paris Agreement to work towards tackling climate change.
Of the banks on the list, 15 increased their fossil fuel funding in the last year-including RBC.
Compared to the other banks that also increased their fossil fuel funding, RBC did increase by a smaller percentage, with a 4% increase over 2021.
In response to a request for comment from the Financial Post, RBC said the report’s authors “do not validate their figures or findings” with the bank, which “can’t confirm their conclusions.”
RBC addressed their climate strategy in a recent emailed statement:
“We are confident in our ongoing engagement with our clients and our climate strategy,” RBC said.
“This includes setting initial interim emissions reduction targets for lending in three key sectors which inform our lending decisions, adding climate considerations to executive compensation and establishing the RBC Climate Action Institute, (which is) focused on advancing climate policy research and action.”
Interestingly, the report’s authors claim that a major portion of fossil fuel financing by banks over the past six years is in the form of bond and equity underwriting, not lending, while most financial institutions include only lending in their environmental policies.
The authors are critical of the slow-to-develop disclosure rules which have allowed this to happen because it “leaves a massive US$2.7 trillion loophole for banks that do not include underwriting in their climate policies.”
Climate change is a critical issue, and financial institutions must be held accountable for their commitment to promoting a swift transition to a low-carbon economy.