Banks and Mountain Top Removal

At your next bank transaction, ponder this: Is my bank financing coal companies? You may be surprised to learn that many large banks are investing in these companies. While coal itself is a major contributor to climate change and water pollution, many companies use the process of mountain top removal (MTR) to acquire coal. Not only does MTR destroy the natural landscape, it also affects the people in the surrounding areas. Fortunately two years ago, many of the leading banks have adopted policies that limit their financing of MTR mining operations.

In 2007 the Rainforest Alliance Network began campaigning Bank of America, one of the leading investors in MTR coal. By 2008 Bank of America (BoA) halted all business with Massey Energy, one of the leading MTR coal suppliers in the US. Shortly after Citi, Credit Suisse, JPMorgan Chase, Wells Fargo and Morgan Stanley followed suit and dropped Massey [Source: Rainforest Action Network]. In their May 2010 report card on banks and mountain top removal, the Rainforest Action Network awarded Credit Suisse with an A- ranking, meaning that the bank developed their own policies and have completely excluded all MTR companies from its commercial lending and investment banking services. Citi and BoA passed with a C- and C respectively though UBS, JPMorgan Chase and GE Financial didn’t make the grade. Still, the efforts of these banks have paid off and the price of coal stock has dropped drastically. In the US, a JPMorgan trader lost $130 million trading coal [Source: Blogging Stocks]and even some of the largest coal producing and mining companies in China have seen their stocks dip [Source: Business Week].

While the major investment banks have begun to turn their back on coal, the World Bank (TWB) continues to carry a torch for mining operations. The World Bank is an amalgamation of five international organizations:

International Bank for Reconstruction and Development (IBRD)
International Development Association (IDA)
International Finance Corporation (IFC)
Multilateral Investment Guarantee Agency (MIGA)
International Centre for Settlement of Investment Disputes (ICSID)

TWB leverages loans out, generally to poorer countries. Most recently, TWB approved a $3.75 billion to South African utility giant Eskom to build a coal factory. This factory is to be the fourth largest coal factory and will emit roughly 25 million tons of CO2 a year. Roughly $700 million of the budget will go to fund things like: a 100-MW wind power project in Sere and a 100-MW concentrated solar power project in Upington [Source: Planet Thoughts]. Despite ths decision, the TWB did not fun the Thar project in Pakistan, which would utilize the 185 billion ton coal reserve in Tharparkur. Instead, the TWB focused $650 million on a project to contain natural gas system and Tarbela Dam power production [Source: Pak Tribune].

While The World Bank might not have the best environmental record, many of the leading investing banks are now taking a serious look at the environmental impact of coal. Banks like Credit Suisse and Wells Fargo are pressuring coal companies to stop their MTR practice, but without government legislation coal companies will continue to mine with this method.

Rising Tide North America
Jasmine Greene

Disclaimer: The views expressed above are solely those of the author and may not reflect those of
Care2, Inc., its employees or advertisers.

Luis J.

1:09PM PDT on Aug 31, 2010

i wanna se why they try to buy the salvation of his life when the ends comming.

send a green star

Gulab R.

9:51PM PDT on Aug 29, 2010

Work on thar coal has been starting... Atomic scientist Dr. Samar Mubarakmand has established base camp and according to samar mubarak he will use UCG technology to use thar coal.

Tamila m.

8:19AM PDT on Aug 24, 2010

interesting...

chiari l.

8:57AM PDT on Aug 23, 2010

my god. the human race is getting dumber and dumber.

Juan Pablo d.

6:29AM PDT on Aug 20, 2010

Again, money is the problem.

kryzstyna P.

9:09PM PDT on Aug 17, 2010

First,there is NO CLEAN COAL!
2.We need to stop supporting the #1 bank that financialy underwrites these endeavers:CITIBANK and the Masey Corporation.
3. Our mountains don't belong to us anymore.90% that will be used for MTR are purchased by international corporations or companies.
4. The "buffer zone"is a law that states waste or unusuable products from coal must be "dumped" 100 feet from any river,stream,or body of water. Why then do individuals,(in Ohio,W.Virginia,Virginia,Kentucky,and Pennsylvania) change water filters every 4 months and the soot is visible and tangible?This is a childs drinking water and bath water.Why do they have such elevated levels of cancer,developmental disabilities,autism,neurological disease,and sickness? Currently they are attempting to dispose of the "buffer zone" completely.
5. We MUST find sustainable energy. Coal produces 51% of our energy.
6. Why do those in top positions at coal companies live a GREAT distance from where the coal plant is? They don't want themselves,their families and their children exposed!
7.Coal companies are smart for profit.They choose the poorest areas in the U.S and make sure "fear" motivates all.You can either work in the mine or at a strip of fast food restaurants.
I could go on but more importantly....lets all do SOMETHING to stop this before our protective ozone layer is gone.THAT-you cannot put a price on!

Linda W.

11:14AM PDT on Aug 17, 2010

This is so weird...I'm reading this article in this window, and at the same time in another window there's an AP article "Old Style Coal Plants Expanding".... coal is big business in this country, and locally the mighty money powers that be are going to build a so-called "clean" coal plant whether the people want it or not. Corporations rule the world :-(

steve f.

5:35AM PDT on Aug 17, 2010

MTR (mountain top removal) is a crime against nature and should be treated as such

Miguel T.

4:55PM PDT on Aug 16, 2010

To think I've been using Bank of America

Lynn Marie M.

1:34PM PDT on Aug 16, 2010

Thanks this is great thought provoking info.