Coal, climate change collide as customers query Aussie banks' green credentials
By Swati Pandey
SYDNEY (Reuters) - After 35 years of banking with big Australian banks like National Australia Bank (NAB.AX: Quote), Paula and Peter Samson closed their accounts to protest the lenders' exposure to the polluting fossil fuel industry.
The Samsons, who live in Perth and drive an electric car, are part of a hundreds-strong, environmentally-driven movement that is taking hold in Australia after sweeping through the United States over the past year or so.
Protesters like the Samsons have withdrawn about A$200 million worth of deposits from the "Big Four" banks - NAB, Commonwealth Bank of Australia (CBA.AX: Quote), Westpac Banking Corp WBC.AX and Australia and New Zealand Banking Corp (ANZ.AX: Quote) - since the divestment campaign began last year, according to data from Market Forces, an independent environmental group that tracks the operations and investments of banks and their effects on the environment.
The amount is minuscule compared to the collective A$19 billion ($17.79 billion) Market Forces said these banks have loaned to Australian coal and gas projects since 2008, but it highlights a potential risk for lenders in an economy that is heavily reliant on resources for growth.
Mining, which includes coal, oil and gas extraction as well as support services, accounts for about 10 percent of Australia's gross domestic product. Since it started in the United States, the campaign has spread beyond banks to funds and university endowments that invest in coal companies.
"We are worried about climate change," Paula Samson, a retiree, said in a phone interview. "The only way to make a change is to take money out of the fossil fuel industry. On a small scale, we need to be doing this."
Australia is home to the world's biggest coal export terminal and coal is its second-largest source of export revenue, with overseas sales this year expected to be worth some A$40 billion.
The burning of coal to generate electricity is a major source of heat-trapping greenhouse gases, which environmentalists say triggers droughts and other natural disasters. Continued...