Since Trump became president, several US banks have backed away from their climate commitments. Now, our review shows that Nordea has also lowered its sustainability standards. It has done so by removing restrictions on some of the worst forms of fossil fuel extraction in its new lending policy. Among other things, the bank is opening up new loans to companies that extract oil sands, shale oil and look for oil further north in the Arctic.

"This is the first time a Swedish bank has lowered its sustainability requirements since we started our reviews ten years ago. It is very worrying and completely the wrong step to take in the middle of a burning climate crisis," says Jakob König, head of Fair Finance Guide in Sweden.

Earlier this year, we revealed that Nordea had lent SEK 15 billion to fossil fuel companies in the last two years.

New billion-kroner loan to shale gas company violated policy

Just three months before Nordea changed its policy, the bank granted a new loan to the Norwegian oil company Equinor, totalling SEK 2.4 billion. This was despite the fact that the loan violated the bank's fossil fuel policy at the time, as the company's extraction of shale oil and gas accounts for far more than five per cent of the company's production, which was the bank's limit at the time. One of the shale gas projects Equinor is involved in is Vaca Muerta in Argentina, which is estimated to emit 5.2 gigatonnes of carbon dioxide, 117 times higher than Sweden's territorial emissions.

"I think many of Nordea's customers are very disappointed when the bank does not keep its promises. People want to be a customer of a bank that takes responsibility for the climate. Not one that uses their money to finance climate villains," says Jakob König.

Supporting oil exploration further north in the Arctic

The oil company Equinor is also active in the Arctic, where one of the projects it is expected to resume is Wisting, which will be the world's northernmost oil field. The oil field is located near the Björnön nature reserve in an area known as ‘Norway's little rainforest’ because of its high biodiversity. Extraction there is very risky, and an accident could have catastrophic consequences.

"As the Earth warms and the ice melts, Nordea wants to support oil companies' search for oil further north in the Arctic. It's very cynical" says Jakob König, who leads the Fair Finance Guide review initiative in Sweden.

Nordea's energy security argument does not hold water

Nordea has defended the policy change by arguing that new sources of oil and gas are needed for Europe's energy security.

"Nordea's argument does not hold water. On the one hand, the International Energy Council has concluded that new deposits are not needed to meet energy needs, and on the other hand, Europe would be both stronger and more secure by switching to renewable energy instead of sinking deeper and deeper into our fossil dependence," says Karin Lexén, Secretary General of the Swedish Society for Nature Conservation.

Read the comparison of the bank's old and new fossil fuel policy

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This article was originally published in Swedish on Fair Finance Guide Sweden's website here. It has been translated by BankTrack with the aid of machine translation.