After more than three years of pressuring major banks that fund mountaintop removal coal mining, Rainforest Action Network [RAN] is reporting that the top four US banks have curbed their loans for this destructive practice.
Within the last two years, Bank of America, Citi, JPMorgan Chase, and Wells Fargo along with Credit Suisse and Morgan Stanley have successively passed public policies limiting their financial relationships with coal operators that practice mountaintop removal (MTR) coal mining. These banks were the lead financiers of the practice prior to their policy shifts. Last month, Wells Fargo became the fourth top US bank to adopt a position limiting MTR financing. These policies signal a sector-wide shift away from a mining practice that has become increasingly controversial and a move toward more environmentally conscious fossil fuels financing.
One of the major impacts of these mountaintop mining policies is that the banks are no longer financing Massey Energy, the leading MTR coal company in the country that was involved in the April 5 Upper Big Branch mine explosion where 29 miners tragically died. In particular, JPMorgan Chase, Bank of America and Wells Fargo, all of which have had substantial financing relationships (underwriting bonds or providing loans) with Massey Energy since January 2005, no longer finance the notorious company.
As examples: Based on Bloomberg data, Bank of America, which was one of the ‘syndication agents’ on a $175 million revolver loan to Massey in March 2008, is no longer on the deal or any others with the company. JPMorgan, similarly, underwrote $180 million in debt securities in 2008 to Massey and was also the lead manager on a $233 million share deal (joint with UBS) that same year. JPMorgan no longer has any financial ties to the company.
This victory could be of great importance to the larger fight for climate justice because, as RAN co-founder Mike Roselle told me last year, “If we can’t win on mountaintop removal, then there’s very little hope that anything can be done.”