Swedish banks continue to favour emissions giants

16 November 2022

After thousands of protests from Swedish bank customers, the big banks in Sweden have greatly reduced their loans to coal and oil companies. At the same time, their lending to companies looking for new fossil deposits continues, despite it being contrary to the Paris Agreement. This is shown by Fair Finance Sweden’s new report with the Swedish Society for Nature Conservation and Greenpeace.

In February 2021, the Fair Finance Guide and the Naturskyddsföreningen revealed that the five largest banks in Sweden – SEB, Nordea, Swedbank, Handelsbanken and Danske Bank – have lent over SEK 400 billion to fossil fuel companies since the Paris Agreement was concluded. It created an outcry and led to thousands of Swedish bank customers protesting against the banks' fossil deals.

Now a follow-up review shows that the banks' support to fossil fuel companies has almost halved (-48 percent) after the protests. Handelsbanken has made the biggest improvement and has not given a single new loan to fossil fuel companies in the last two years. The bank has also tightened its policy and is now one of two major banks in the world that says absolutely “no” to financing companies that expand the extraction of fossil fuels.

“It is gratifying that a major Swedish bank has become an international example when it comes to sustainable financing. Now more banks must follow suit and take responsibility, because there are still large fossil fuel companies that receive loans to continue with activities that worsen the climate crisis”, says Karin Lexén, Secretary General at the Nature Conservation Association.

Continued billions to climate criminals

SEB, Nordea, Swedbank and Danske Bank have together lent SEK 116 billion to fossil fuel companies in the past two years. More than half of the money (68 billion kroner) has gone to companies that are expanding their extraction, despite the fact that the hunt for additional fossil fuels is contrary to the Paris Agreement. None of the fossil fuel companies have adopted robust phase-out plans in line with the climate goals.

“The banks talk about a green transition, but the fact is that a large part of their lending still goes to fossil fuel companies that are moving in the wrong direction. If the banks are to seriously contribute to the transition, they must stop the support until the companies have changed course”, says Jakob König at Fair Finance Guide.

A large part of the loans have gone to fossil fuel companies that conduct some of the most climate and environmentally damaging activities:

- SEB, Nordea, Swedbank and Danske Bank have lent 17 billion to Fortum, which has coal-fired power plants in Russia.

- SEB has lent six billion to the German coal company RWE, which is one of Europe's largest emitters of carbon dioxide.

- SEB and Swedbank have given 1.5 billion in new loans to an Estonian company that extracts shale oil, which has a particularly large environmental and climate impact.

- SEB, Nordea, Danske Bank and Swedbank have lent 43 billion to companies looking for oil in the Arctic, which we revealed earlier last fall.

Support for several of the worst offending companies halted

This year's report shows, however, that the banks seem to have stopped supporting a couple of the worst companies that were highlighted in the last review. SEB has for many years financed the company Glencore, which is the world's largest exporter of coal. Both SEB and Nordea have previously also financed the oil company ConocoPhillips, which is active in oil sands. This year's review shows that SEB and Nordea are not among the banks that continued to give loans to the companies, which indicates that the Swedish banks have stopped their support.

More fossil-free funds

Regarding the banks' investments in fossil fuel companies, mainly through their funds, all five banks have reduced their holdings in the last two years. Especially Swedbank and SEB, who followed Handelsbanken's decision to exclude fossil fuel companies from all their funds.

“It is positive that several Swedish banks have chosen to purge fossil fuel companies from their funds. This is appreciated by many consumers and savers who do not want to support fossil fuel companies with their money”, says Jakob König.

Much remains to be done, however so keep protesting to the banks - it makes a difference. Recently, the Norwegian company Equinor announced that they are pausing the controversial Wisiting oil project in the Arctic, a project that, among other things, thousands of Swedish bank customers protested against.

Download the report on English here.

See how to mail the banks here.