Exodus by Wall Street banks from climate group worries advocates

LONDON/NEW YORK, Jan 6 (Reuters) - U.S. lenders have been rushing in recent weeks to leave one of the world's top banking sector climate coalitions, drawing scorn from campaigners who worry the industry is losing resolve to take action on fossil fuels.

Goldman Sachs (GS.N), opens new tab broke ranks to announce on Dec. 6 it was leaving the Net-Zero Banking Alliance (NZBA) and was soon followed by Wells Fargo (WFC.N), opens new tab, Citi (C.N), opens new tab, Bank of America (BAC.N), opens new tab and Morgan Stanley (MS.N), opens new tab. The exit of some of the world's biggest lenders means the NZBA, whose members aim to align their financing with the global climate fight, now includes just JPMorgan (JPM.N), opens new tab among the Big Six U.S. banks.

The exodus ended unhappy marriages for most after Republican politicians warned that membership in the group, particularly if it led to reduced financing for fossil fuel companies, could breach antitrust rules.

Banks that have pulled out may now reduce their commitments to climate-friendly policies, said Patrick McCully, senior analyst for energy transition at Reclaim Finance.

"The key thing to watch will be weakening of their existing targets and policies," said McCully, noting some banks had ambitious targets for decreasing emissions. Still, he did not expect banks to announce publicly any such changes.

While the NZBA had sought at various times to tailor its rules to keep the large and systemically important banks onboard, most recently last year, the efforts were ultimately not enough.

Jeanne Martin, head of banking programme at advocacy group ShareAction, said those leaving were sending a signal to the market that climate change has become even less of a priority for th...
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