Credit Agricole Stops Loans for New Oil Fields, Plans More Emission Cuts

The largest retail lender in France, Credit Agricole, announced on Tuesday that it has ceased funding new oil extraction projects and had developed strategies to reduce emissions associated with loans to five of its high-polluting industries.

The decision was made at a time when the banking industry is under greater regulatory and investor pressure to align lending with the aims of the international climate agreement, including by setting short-term targets.

Only a small number of banks, notably the largest domestic lender in Britain and the Netherlands, ING Groep NV, have worldwide ceased funding for the development of new oil fields.

Additionally, Credit Agricole provided emission reduction goals for its oil and gas, power, commercial real estate, automotive, and cement industries.

Instead of the previous objective of 20%, it stated it will cut its credit exposure to oil exploration and production by 25% by 2025.

The bank had pledged in June to reduce client emissions from the oil and gas industry by 30% by 2030. The bank claimed to have exposure to the industry of 24.7 billion euros ($25.95 billion).

Reclaim Finance, a campaign organization applauded the bank’s decision to stop directly funding any new oil fields but demanded that gas development projects be added as well. It still has to do a lot of effort to completely match with science, notably in the area of gas.

As part of a strategy to cut emissions intensity, a metric of emission volume, in half by 2030, and the lender announced it will fund additional electric car startups in the automotive industry.

By stopping funding for thermal coal by 2030 in OECD member nations and by 2040 in the rest of the globe, the bank hopes to lower the emissions intensity of its power portfolio by 58% by 2030.

By 2030, it is intended to reduce yearly emissions per square meter in the commercial real estate industry by 40% and emissions per tonne of cement produced by 20%.

The lender announced that it will set new goals for five more industries in 2019: agricultural, steel, residential real estate, shipping, and aviation.