To avoid backlash in West Virginia, BMO Bank secretly abandoned its policy against lending to the coal industry in late 2023.
The change was seen on Monday after West Virginia Treasurer Riley Moore revealed the banks were being added to its boycott list, which does not include BMO. The bank was warned that it may be added to a state list of businesses being considered for boycott by Moore's office due to their involvement in the fossil fuel sector. This was in late February. The US division of Bank of Montreal, situated in Toronto, is called BMO's general counsel. Timothy Cox responded in February to a warning by stating in a letter dated March 25 to the state treasurer's office that the company had withdrawn a statement outlining its lending limitations to the coal industry due to changes in policy that would take effect in November 2023. Bloomberg News was able to get Cox's letter by means of a public records request.
For over two years, Republicans have been criticizing the banking industry's environmental, social, and governance plans. This has led banks and investment businesses to talk less about their climate efforts. CEO Sergio Ermotti stated last month that it is not the role of banks to act as "climate police."
BMO's position on the coal business remains unchanged, according to an anonymous source familiar with the situation. According to the source, their strategy for coal still depends on evaluating the risks of each company individually, and removing the statement doesn't mean they want to increase exposure.
In 2022, the Bank of Montreal reported that in 2021 they would make a policy about coal lending. They will not provide financing for new coal power plants or coal mines. It also mentioned that it will not give credit to new customers with large thermal coal mining or coal-fired power production facilities.
The bank's webpage used to include information about its positions on political donations, human rights, and anti-money laundering procedures, including a statement about coal lending.
