Increased funding for fossil fuels was discovered, as significant banks chose to withdraw from the New Zealand Bankers' Association, according to a recent report.
In a stark contrast to the International Energy Agency's warning that no new oil or gas fields are needed to meet the 1.5°C target of the Paris Agreement, a new report reveals that global financing of fossil fuel companies has increased significantly.
Published by Rainforest Action Network, Sierra Club, Indigenous Environment Network, and others, the "Banking on Climate Chaos" report shows that financing reached $869 billion in 2024, an increase of $162 billion from the previous year. This trend is concerning, as the report highlights that 65 major banks have collectively funneled $7.9 trillion into fossil fuels since 2016.
Jessye Waxman, campaign advisor at the Sierra Club and report co-author, expressed her dismay at the banks' retreat from robust climate commitments. She stated that this is unacceptable, deeply irresponsible, and a clear capitulation to political pressure. Waxman called on banks to shift away from risky financing and commit to reducing emissions via the companies they finance, with a genuine focus on helping to decarbonize the economy and support the clean energy transition.
Notably, banks that have exited the Net Zero Banking Alliance (NZBA), including JP Morgan Chase, Bank of America, and Mizuho Financial, were among the biggest funders of fossil fuels. However, one ex-NZBA member, Sumitomo Mitsui Banking Corporation, cut both fossil fuel and expansion financing last year.
The report also notes that 70% of expansion financing came from banks with exclusion policies, but loopholes around corporate-level financing enable systemic risk accumulation. Climate stress tests and voluntary frameworks are not enough to shift lending behavior, according to the report.
Corporate-level financing represented 94.7% of all fossil fuel deals. The Banking on Climate Chaos report also reveals that over $1.6 trillion has been provided for expanding fossil fuel operations since 2021. US banks were the biggest financiers, providing $289 billion (33%) of total annual financing.
In Europe, Barclays, Santander, and Deutsche Bank increased their lending to fossil fuel companies. Despite this, France's La Banque Postale did not provide any financing for fossil fuel expansion in 2024. Santander made the largest single reduction in expansion finance. The ING Group divested $3.2bn from fossil fuel financing compared to 2023.
The report suggests that policymakers must enforce regulatory measures to reduce fossil fuel financing and avert financial system collapse. It highlights that banks expect returns on their investments in fossil fuel companies, which necessitates these companies to continue producing and thus locking us into decades of dependence on dirty energy.
This page was last updated on July 2, 2025. For more information, please refer to the Banking on Climate Chaos report.
