When you make a deposit at the bank, your money does not just sit in a vault. Banks lend your money to borrowers, and earn profits by charging interest on the loans. Now, some banks are re-evaluating the type of projects they’ll finance.
Frishberg: “What we’re doing is we’re thinking about how do we really pull back from financing fossil fuel infrastructure.”
Ivan Frishberg is leader of sustainability banking at New York-based Amalgamated Bank, which went public last year.
Frishberg: “We committed not to put any of the deposits that our customers leave with us into fossil fuel projects and the things that are really exacerbating climate change.”
He says the bank has also increased its lending to renewable energy and energy efficiency projects. And for investors, they offer a portfolio that excludes coal, oil, and gas companies, as well as utilities that use fossil fuels.
Frishberg: “We have more and more customers coming to us – retail customers, commercial customers, nonprofits and philanthropies – who are saying, ‘Look, it matters where we bank, and we want to put our money to work doing good things, not doing things that are undermining our view of the world.’”
In other words, through their lending and investment strategies, banks and their customers have the power to help grow a more climate-friendly economy.
Reporting credit: Rachel Gulbraa/ChavoBart Digital Media.