Greenest Banks of 2026 Widen the Gap as Fossil Fuel Financing Hits $906 Billion

August 25, 2026

5:55 am

One French lender financed no fossil fuels at all last year, while the world’s 65 largest banks pushed a decade of oil, gas, and coal lending past $8.7 trillion.

The gap between the greenest banks and the rest of the global banking system is no longer a matter of degree. It has become a difference in kind. In 2025, the world’s 65 largest banks committed $906 billion to companies operating in fossil fuels, an increase of $64 billion, or nearly 8 percent, on the previous year. Over the decade since the Paris Agreement, those same institutions have channelled close to $8.7 trillion into oil, gas, and coal. Within that same group, one bank financed none of it.

La Banque Postale, the French lender majority-owned through the state postal group, provided no fossil fuel financing whatsoever in 2025. It is the only institution among the 65 to have done so, and the distance between its position and the sector average now defines what the greenest banks actually look like in practice rather than in disclosure documents.

Concentration Is the Story, Not the Total

The aggregate figure understates how narrow the problem has become. Financing for companies expanding oil, gas, and coal developments reached $508 billion in 2025, up $108 billion, or roughly 27 percent, in a single year. Twelve banks accounted for close to 40 percent of all fossil fuel financing across a universe of roughly 2,000 institutions. Fifteen percent of bank financing went to just 10 companies, and three of them, Venture Global, Enbridge, and Energy Transfer, absorbed $77 billion between them.

JPMorgan Chase remained the largest fossil fuel financier at $58 billion in 2025, up 12.6 percent. Bank of America followed at $47 billion, with Mitsubishi UFJ Financial Group also at $47 billion after a 21 percent annual increase. Nearly all of this money moves through six jurisdictions. The United States, Canada, Japan, China, the United Kingdom, and the European Union together account for 87 percent of global bank fossil fuel financing. The American share has risen to 32 percent from 28 percent in 2021.

Canada’s position is the most disproportionate. Home to 0.5 percent of the world’s population, it accounts for 11.8 percent of global fossil fuel financing. Financing for oil and gas developers across Royal Bank of Canada, Scotiabank, Toronto-Dominion Bank, CIBC, and BMO rose more than 27 percent in 2025 to nearly $70 billion. Three of those banks sit among the world’s 12 largest fossil fuel financiers over the 2021 to 2025 period, providing more than $437 billion between them. Royal Bank of Canada and Scotiabank dropped their 2030 decarbonisation targets during the period, and Scotiabank abandoned its 2050 net-zero target entirely.

The Small Group Moving in the Other Direction

Twenty-six of the 65 largest banks reduced their fossil fuel financing in 2025, up from 23 the previous year. The reductions clustered almost entirely in Europe, where regulatory expectations rather than voluntary pledges now drive lending policy, and where nearly all of the greenest banks in the systemically important tier are domiciled. BNP Paribas cut its fossil fuel financing by nearly 28 percent in a single year. UBS and La Caixa were among the other large decliners.

Liquefied natural gas is where the divergence has become sharpest, and where it stopped being purely a climate question. Financing for companies involved in LNG expansion reached an all-time high, totalling $607 billion between 2021 and 2025, with $157 billion committed in 2025 alone. Mizuho Financial led at $38.2 billion over the five years, followed by JPMorgan Chase at $34.2 billion and Mitsubishi UFJ Financial at $34 billion. Five European banks sit inside the top 20.

Against that, Nordea introduced a fossil fuel sector guideline in March 2026 ending all direct project financing for new LNG import and export terminals without exception. Only five of the 65 largest banks now exclude project finance for all new LNG export terminals, and only La Banque Postale and Nordea exclude import terminals as well. La Banque Postale remains alone in also halting corporate financing to LNG developers, which is the gap that matters most: the majority of LNG expansion is funded through corporate loans and bond underwriting rather than project finance, leaving most exclusion policies structurally incomplete.

Energy Security Has Absorbed the Climate Argument

The strategic context around these decisions changed decisively in 2026. Disruption in the Strait of Hormuz sent gas prices surging and confirmed a pattern that European and Asian governments had been tracking since 2022. LNG prices are structurally volatile and acutely sensitive to geopolitical shock, and the regions most dependent on imported cargoes carry the cost.

European energy policy has responded by treating reduced gas dependence as a matter of strategic autonomy rather than climate ambition, and governments across Asia have signalled a comparable shift toward accelerated renewable deployment. This reframing is what gives the LNG exclusions adopted by a handful of European banks a significance disproportionate to their market share. A bank declining to underwrite new import capacity is no longer positioning itself against its home government’s energy doctrine. It is positioning itself alongside it.

That alignment does not yet extend far. European banks financed some of the largest LNG developers in the United States through 2026, including a $2.25 billion bond issuance for the world’s largest LNG developer supported by Santander, Barclays, Standard Chartered, Natixis, and ING. Several of those institutions maintain LNG exclusion policies that cover project finance only.

Ratios Replace Pledges as the Measure of Record

The metric that has displaced net-zero membership is the energy supply financing ratio, which measures clean power financing against fossil fuel financing. It has become the working test for separating the greenest banks from those that simply describe themselves that way. Six banks now publish the indicator, its methodology, or a commitment to produce one, up from two in 2024.

The approaches diverge by region in revealing ways. BNP Paribas and Crédit Agricole publish current ratios and have committed to nine-to-one targets by 2030 and 2028 respectively, but both restrict the fossil fuel side of the calculation to narrow segments of the oil and gas value chain, excluding LNG and gas-fired power, and both cover lending only. Bond and equity underwriting accounted for 36 percent of BNP Paribas’s fossil fuel financing and 27 percent of Crédit Agricole’s between 2021 and 2024, meaning the published figures understate exposure.

Citi and JPMorgan Chase take the opposite approach, publishing detailed methodologies covering both lending and underwriting but setting no medium-term target, and both count fossil-based hydrogen and certain carbon capture projects on the low-carbon side. Royal Bank of Canada publishes a methodology but not a ratio. Across the 65 largest banks, the aggregate ratio for clean power supply sat at 0.42 to one against a benchmark of six to one required by 2030.

The Scale Problem Facing Values-Based Lenders

Among institutions built entirely around climate alignment, 2026 delivered a mixed verdict. Triodos Bank cut its financed emissions by 20 percent in 2025 and met its 2030 absolute emissions target, at least 42 percent below 2020 levels, four years early. It remains the only B Corp certified bank listed on Euronext Amsterdam and co-founded a network of roughly 70 values-based banks worldwide.

It also posted a net loss of 25 million euros for 2025, driven by a 59.7 million euro credit loss provision on a German fibre optic loan portfolio, and moved to wind down its German operations under a cost reduction programme. In the United Kingdom, Triodos sits alongside Nationwide, the Co-operative Bank, and Monzo in a small group of retail institutions that do not directly finance fossil fuels.

The pattern holds across the category. These banks prove the model works. They have not yet proved it scales, and the financial pressure on the most prominent of them in 2025 illustrates why the greenest banks at systemic scale remain a European regulatory phenomenon rather than a market one.

Litigation as Climate Finance Policy

In the United States, the largest publicly capitalised green lending programme in the world remains suspended in court. On Aug. 4, 2026, the full District of Columbia Circuit Court of Appeals ruled six to four that the Environmental Protection Agency likely acted unlawfully in terminating $20 billion in Greenhouse Gas Reduction Fund grants in early 2025. The ruling restored an injunction against the clawback but did not release the money, and an appeal to the Supreme Court followed. Congress had separately repealed the provision creating the programme, leaving the legal position unresolved more than a year after the initial freeze.

What the Rankings Now Measure

The league tables of the greenest banks have quietly stopped measuring corporate ambition. They measure jurisdiction, supervisory pressure, and the degree to which a national government has decided that dependence on imported fossil fuels is a strategic liability. European banks are cutting fossil fuel financing because European regulators have made climate risk a prudential matter and European governments have made gas dependence a security concern. American and Japanese banks are increasing it because neither condition applies.

That correlation is the most durable finding of the past two years. It suggests that the composition of the greenest banks a decade from now will be decided less in bank boardrooms than in central banks, finance ministries, and energy security reviews, and that the sovereign question underneath all of it is which countries intend to own the financing architecture of the energy system that follows.