CommBank not the last of big four in green sights over coal

Environment groups have vowed to step up pressure on major banks to stop lending to fossi­l-fuel projects.

The Wiggins Island coal project in Gladstone has suffered heavy losses. Picture: Lyndon Mechielsen

Environment groups have vowed to step up pressure on major banks to stop lending to fossi­l-fuel projects­ after the Commonwealth Bank this week ended its role as lead adviser to Adani’s $16 billion mega Carmichael coalmine in Queensland.

Green campaigners said the CommBank decision to withdraw from the projec­t could be a turning point in a long-running global­ campaign to starve fossil-fuel developm­ents of funding.

Adani has played down the significa­nce of the end of its relationship with the bank but activists said it reflected a broader change in attitude from the major banks. “The financial risks of the coal sector, which is clearly entering a long-term decline, are starting to manifest,” Markets for Change research­ leader Julien Vincent said.

Australian banks already faced heavy losses on several recent­ projects, including Wiggins Island in Gladstone and Whitehaven Coal in NSW, he said. And there was a growing institutional risk for banks that were too closely aligned with fossil fuels.

“CommBank, as with the other major Australian banks, needs to operate in and beyond Australia’s borders so they can’t let the ‘coal is good for humanity’ approach of Tony Abbott dictate their own operations­,” Mr Vincent said.

He said the decision on Adani was no doubt related to specific­ issues: environmental, financial­ and the bank’s reputation. “I also think it coincides with a time when CommBank and all the other majors­ are forced to reconsider their approach to fossil fuels.”

Markets for Change and other Green groups have waged a relent­less campaign in boardrooms around the world to warn of the potential financial risk from protracted litigation on new project­s and uncertainty becaus­e of climate change action.

The Wilderness Society national campaign manager Lyndon Schnei­ders said “the only rational response for environmentalists is to engage directly with bankers and then investors”.

“They know risk when they see it and they ­understand that govern­ments changing laws and bending the rules doesn’t make environmental concerns go away, or the impacts any less real.”

The ANZ bank has been targeted as Australia’s biggest lender to domestic coal, oil and gas ­projects. An analysis of lending by Markets­ for Change found that Australia’s big four local banks provided $36.7bn of a total $134.3bn to the fossil-fuel sector between 2008 and last year.

ANZ has made $12.6bn in loans to the sector since 2008. CommBank had $9.9bn, NAB $8.3bn and Westpac $5.9bn.