A new report card issued by Rainforest Action Network and the Sierra Club ranks ten of the world’s largest banks on their financing of mountaintop removal coal mining projects.
Since 2010, the report card found that the top three financiers of the destructive mining practice are PNC (NYSE: PNC), Citi (NYSE: C), and UBS (NYSE: UBS). Deutsche Bank (NYSE: DB) and GE Capital (NYSE: GE) received failing grades for having no policy in place to guide funding of mining companies. Credit Suisse (NYSE: CS) and Wells Fargo (NYSE: WFC) were found to have the strongest policies in the sector.
The report card comes as Appalachian residents arrive in the nation’s capital for their "Week in Washington," raising awareness about the destruction in their communities. The document explores the financing practices of Bank of America (NYSE: BAC), Citi, Credit Suisse, Deutsche Bank, GE Capital, JPMorgan Chase (NYSE: JPM), Morgan Stanley (NYSE: MOR), PNC, UBS and Wells Fargo. Since January 2010, the report card found that these ten banks have provided more than $2.5 billion in loans and bonds to companies practicing mountaintop removal coal mining.
Mountaintop removal is the subject of enormous public opposition as well as growing regulatory and legislative scrutiny, which banks have been forced to address. Since last year’s report card (April 2010), there have been five new policies on mountaintop removal from Chase, Wells Fargo, PNC, UBS, and Credit Suisse.
"Mountaintop removal coal mining is bad for health and bad for business. From a regulatory and financial perspective this disastrous mining practice is too big of a risk for banks, and certainly too big of a risk to America’s families," said Amanda Starbuck of Rainforest Action Network. "Plain and simple, banks beware-mountaintop removal coal mining is a bad investment."
From a regulatory perspective, the report shows that of all the mountaintop removal permits reviewed in 2010 by the EPA, 99 were denied or withdrawn, 84 are still pending and 18 have been approved. The report also finds that in 2010, coal production figures for the mountaintop removal sector were in decline. Mining giants, like Arch Coal, are moving away from Central Appalachia coal production, and focusing on new opportunities in Wyoming’s Powder River Basin and on the West Coast with export terminals.
"Mountaintop removal coal mining has no place in a clean energy economy, and the banks that finance this destructive practice deserve our scrutiny," said Mary Anne Hitt, Director of the Sierra Club’s Beyond Coal Campaign. "Those who fund mountaintop removal coal mining are lighting the fuse that leads to the devastation of communities, waterways and landscapes across Appalachia."
RAN and Sierra Club disclosed the findings of this report card to each of the ten analyzed banks and offered them the opportunity to improve their grades with further information or changes to banking policies. In response to initial report card findings, three banks will be strengthening their lending guidelines on mountaintop removal, the organizations said.
Credit Suisse topped the list, earning an "A-" for its efforts to promote responsible mining practices. Credit Suisse has confirmed that they do not finance the extraction of coal in a mountaintop removal setting. (Credit Suisse is also on a recent list of the ten greenest banks, released by Bloomberg Markets.)
The report card calls for the ten banks reviewed by RAN and Sierra Club to strengthen their policies and cease their financial support for mountaintop removal. The ‘best practice’ recommended in the report card is a clear exclusion policy on commercial lending and investment banking services for all coal companies who practice mountaintop removal coal extraction.
Bank of America was the first bank to issue a public policy limiting its mountaintop removal financing back in December 2008. Citi followed in August 2009, Credit Suisse in September 2009, Morgan Stanley and JPMorgan in May 2010 and Wells Fargo in July of 2010. While each banks’ policies differ, they all demonstrate concern about the environmental and investment risks associated with mountaintop mining, and all of the banks have made clear moves away from companies who primarily focus on this form of extraction.
Mountaintop removal mining is a devastating form of mining where companies blow the tops off mountains to reach a thin seam of coal and then dump the waste rock into valleys below. This destructive practice has buried nearly 2,000 miles of streams and threatens to destroy 1.4 million acres of land by 2020. The mining destroys Appalachian communities, the health of coalfield residents and any hope for positive economic growth.
View the report card at the link below.