Wells Fargo & Co., one of the largest financial institutions in the United States, has announced that it is leaving the world’s largest banking climate alliance.
According to media reports, the mentioned decision of the specified lender is another signal that Wall Street is gradually abandoning such alliances.
Wells Fargo on Friday, December 20, released a statement on termination of its membership in the Net-Zero Banking Alliance (NZBA). At the same time, the financial institution did not provide any comments on the reasons for its mentioned decision.
The leaving of Wells Fargo, which is headquartered in San Francisco, from the specified alliance is not the first such case. NZBA was also left by Goldman Sachs Group Inc. in the current month.
According to media reports, financial institutions in the United States are currently facing increasing pressure from lawmakers who are members of the Republican Party. In this case, it implies investigations and lawsuits related to the efforts of the US banking sector to address climate change.
The House Judiciary Committee, led by Ohio Republican Jim Jordan, said last week that substantial evidence of collusion and anti-competitive behavior by financial institutions had been recorded. Separately, BlackRock Inc., Vanguard Group Inc., and State Street Corp. have been sued by the group of states led by Texas on charges of violating antitrust laws as part of an increase in electricity prices through their investments.
The House Judiciary Committee released a report critical of financial environmental alliances. In this case, it is claimed that the mentioned alliances formed what was described by the mentioned committee as a climate cartel.
NZBA is part of the Glasgow Financial Alliance for Net Zero, launched ahead of the climate summit in Scotland in 2021. At that time, such large US banks as JPMorgan Chase & Co. and Citigroup Inc. joined this group.
A spokesman for NZBA said the alliance respects Wells Fargo’s decision, which was made based on individual circumstances. It was also noted separately that since the founding of the mentioned group in 2021, five banks have left it. At the same time, over the mentioned period, more than 100 creditors joined the alliance. Separately, it was noted that the NZBA member banks have made significant progress in setting net-zero targets.
Wells Fargo is one of the largest financiers for the fossil-fuel industry. The data compiled by the media indicates that this bank ranks second in terms of volumes of bonds and loans to oil, gas, and coal companies. JPMorgan Chase ranks first in terms of the volume of the mentioned actions.
Banks and money managers increasingly have been defecting from other climate groups amid pressure from Republican lawmakers. This month Franklin Templeton said it was leaving Climate Action 100+, which was founded to force high-polluting firms to curb their emissions. This company two years ago hired Anne Simpson, who was the first chair of CA100+, as its global head of sustainability.
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