Intesa Sanpaolo keeps silence about its climate responsibilities

Rome, 24 April 2024 – ReCommon strongly condemns the behavior of Intesa Sanpaolo, who prefers to maintain an eloquent silence on the possibility of revising its commitments regarding the stop to financing the fossil fuel sector. Italy’s leading bank, engaged today in its closed-door shareholders’ meeting, seems to want to sweep under the carpet its involvement in the climate crisis, stemming from its generous support for the fossil fuel sector – $81.6 billion from the Paris Agreement to date – which in 2023 alone recorded $8.6 billion in investments and $7.5 billion in financing. As for companies that continue to expand the oil and gas sector, the available figures tell of $986 million in 2022 and $1.5 billion in 2023. The increase of 52% in the space of a year is led by the Italian energy company, Eni, which has benefited from the entire amount allocated in 2023, making Intesa Sanpaolo the world’s second-largest lender of Eni after UniCredit.

Italy’s largest bank’s climate and environment policy is among the weakest, when compared to other European financial institutions, due to the numerous gaps and loopholes. Urged again by a group of investors, the Intesa Sanpaolo banking group has promised to update a new policy by the end of 2024. 

In the meantime, the weaknesses remain. While competitors have already stopped financing coal, Intesa Sanpaolo does not even indicate a date for the complete phase out of the entire sector and continues to feed the most polluting among fossil fuels: $3.36 billion in coal financing in 2023, as well as investments aimed at companies that continue to have expansion plans in the coal sector such as Adani,  Glencore and Sasol.

Moreover, the rules on financing the unconventional oil and gas sector  do not take into account projects involving ultra-deep water extraction. These projects include Rovuma LNG, led by Eni and the U.S.-based ExxonMobil, the largest liquefied natural gas project in Mozambique, and Coral North FLNG, a floating gas extraction and liquefaction platform, which is a duplicate of Eni’s Coral South FLNG project and supported by its subsidiary UBI Banca with $160 million. Despite having already supported an extraction project in Mozambique, Intesa Sanpaolo has not given ReCommon any clarification regarding its possible involvement in Rovuma LNG or Coral North FLNG.

Liquefied natural gas (LNG) is the basis of the bank’s fossil business plan, particularly in the United States. Since 2016, Intesa Sanpaolo has issued $4.8 billion in loans to LNG companies in the Gulf of Mexico. A region that is already battered by extreme weather events, by the concentration of large industrial plants and now sacrificed on the altar of LNG for the Asian and European markets. In July 2023, Intesa Sanpaolo granted a $1.08 billion loan for the construction of the Texas liquefied natural gas export terminal Rio Grande LNG, owned by the US multinational energy company NextDecade.

“Rio Grande is a project that will have serious negative repercussions from an environmental, economic and social point of view, so much so that the reputational risk associated with it has led BNP Paribas, Societe Generale, Crédit Mutuel, UniCredit and La Banque Postale to commit not to finance similar projects in the Rio Grande Valley,” said Daniela Finamore of ReCommon. “Also in this case, when asked by international organizations and impacted communities to provide clarifications on the financing, Intesa Sanpaolo did not give any kind of feedback, confirming its policy of total closure to the demands of civil society, at least in climate and environmental matters,” Finamore concluded.

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