Investec’s UK business has hit its target of zero thermal coal exposure in its loan book two years ahead of schedule, with the group confident it will meet its SA target in the next five years.
The lender said on Monday its UK business had as of September 2024 eliminated all coal exposures in its loan book, “achieving a target that was originally set for 31 March 2027”.
The group said in its annual report its exposure to thermal coal as a percentage of total core loans and advances was 0.05% at the end of March.
“We have set a target to have zero thermal coal exposures in our loan book by 31 March 2030. This target has already been met by our UK business, which has had no coal exposure in its loan book since September 2024,” it said.
Investec recently said it plans to facilitate £18bn of sustainable and transition finance by 2030. The UK business aims to contribute £14.9bn towards this target while the SA business is expected to contribute R74bn.
The group, headed by Fani Titi, has committed to ceasing all new financing for oil and gas exploration, extraction or production projects, regardless of jurisdiction by 2035.
The group acknowledged that oil and gas continued to be vital energy sources and were essential to the global energy supply.
However, the group oil and gas must be produced using best practices to minimise associated greenhouse gas emissions and other potential negative effects.
“Given the complexities of supporting this industry, we will evaluate a range of carbon intensities for specific projects in relation to industry standards to guide our due diligence,” it said.
“For instance, we view liquefied natural gas [LNG] as a means to facilitate the transition towards net zero, particularly in economies aiming to reduce their dependence on coal.”
Standard Bank CEO Sim Standard Bank earlier this year told the group’s shareholders it was unreasonable to expect African countries to cease reliance on fossil fuels in the rush to transition, and the lender would continue to invest in oil and gas projects.
Tshabalala said the bank believed the just energy transition must recognise the right of African nations to develop their natural resources and economies to improve their people’s lives.
He cited countries such as Nigeria, Angola, Ghana and Mozambique, which produce oil and gas for international markets, saying their activities in the space hauled in foreign currency and tax revenues to develop their respective economies.
Standard Bank has set a target to limit its upstream oil and gas exposure to less than 30% of its energy book, and less than 3% of the group’s total loans and advances in the next five years.
The bank’s updated sustainable finance mobilisation target is more than R450bn by 2028, cumulative from what it has already deployed from 2022.
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