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Towards more sustainable lending


Published: 23 December 2022

Companies in carbon-intensive sectors to which banks lend are not switching to sustainable alternatives quickly enough to meet the goals of the Paris Climate Agreement. This means transition risks in Dutch banks' loan portfolios will increase sharply in the years ahead.

In this study, we analyse the deviation of companies in loan portfolios of Dutch banks from the transition path required to meet climate goals. We conclude that car manufacturers are not switching from producing combustion-engine cars to electric cars rapidly enough. The switch from fossil-fuel-based power generation to renewable sources is also progressing too slowly. In addition, oil extraction by companies in the loan portfolios of Dutch banks will increase in the coming years, while a decrease is needed. Only in the natural gas production sector on average the companies are adapting quicker than the transition scenario calls for.

Towards more sustainable lending

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