Johan Frijns: +31 24 3249 220, email@example.com
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Today, as Mizuho Bank takes over from ING as the chair of the Equator Principles Association, the NGO network BankTrack calls on the Japanese bank to lead by example by meeting the new Equator Principles transparency requirements in full, and by taking significant steps to tackle the climate impacts of its lending.
The latest version of the Equator Principles (EPIII) was launched in June last year and came into force on 1st January 2014, bringing with it new requirements for banks to report the names of projects financed to the Secretariat for publication on the Equator Principles website - subject to obtaining client consent.
For higher risk projects (category A and, as appropriate, category B), EPIII also requires clients to disclose summaries of Environmental and Social Impact Assessments, as well as details of greenhouse gas emissions for high-emissions projects. However no such disclosures have yet been made, and no names of projects financed have yet been reported on the Equator Principles website.
Mizuho Bank, which today becomes the first Asian chair of the Equator Principles, has huge exposure to the fossil fuel industry, and finances a number of "dodgy deals" being opposed by civil society groups and local organisations. The bank, one of Japan's three megabanks, was shown by BankTrack's recent Banking on Coal report to be among the world's top 30 financiers of the coal mining industry, ploughing over 1.2 billion euros into the sector since 2005.
Its involvement includes being one of the top five financiers of Drummond, a US coal mining company which has been accused of having financed Colombia's paramilitary forces and which was ordered by the Colombian state to stop exporting coal from the country's ports earlier this year following an incident in which the company was fined USD 3.5m for spilling hundreds of tons of coal into the sea.
Mizuho is also helping to finance the building of Southeast Asia's largest coal-fired power plant on Indonesia's Java island, the Batang Project, encouraging a dangerously misguided rush for coal power which will have devastating social and environmental impacts in the country, while pushing Indonesia down a catastrophic path towards climate change. Meanwhile the US, UK and Nordic governments, together with the World Bank, have committed not to finance new coal fired power plants except in exceptional circumstances.
BankTrack Director Johan Frijns said: "Four months on from EPIII officially coming into force, we have still not seen the Equator Principles Association publish details of any projects financed. As the first Asian chair of the Equator Principles, Mizuho has a chance to show the Equator Principles are serious on disclosure by publishing details of its project related finance as it happens, and ensuring others do the same."
"Mizuho's finance for projects like the Batang Coal Power Plant, the kind of project which many development banks will no longer touch, shows the importance of this kind of transparency. Under EPIII, banks must now ensure an ‘alternatives analysis' is carried out to evaluate less greenhouse gas intensive alternatives when financing projects with emissions of over 100,000 tonnes of CO2 equivalent. In itself this is a weak requirement, as banks are under no obligation to pursue the less polluting alternatives they identify. However such an alternatives analysis should show clearly the madness of ploughing money into projects like dirty coal plants in Indonesia, further contaminating the air people breathe and contributing to dangerous climate change, when clean alternatives exist,"added Johan Frijns.