M&T Bank’s Gold Dome building in downtown Buffalo. M&T is the biggest bank in Buffalo and a major lender to National Fuel Gas (Source: Wikimedia Commons)
Whether they realize it or not, Western New Yorkers who have mortgages or other loans from Buffalo’s most prominent banks are financing fossil fuel industry efforts to lock in new carbon emissions with their payments. The biggest banks in Buffalo – including M&T Bank, KeyBank, and Bank of America – are lending hundreds of millions of dollars to coal, oil, and gas companies, including National Fuel, a local corporation engaged in a legal battle to build a pipeline through Western New York to export fracked gas to Canada.
Banks financing National Fuel and other fossil fuel companies are also governing members of the Buffalo Niagara Partnership, a local corporate advocacy group lobbying against state legislation to combat climate change and for building out oil and gas infrastructure.
Northern Access, National Fuel’s proposed pipeline project, would cross 206 bodies of water and impact 389 wetlands in order to ship gas from National Fuel’s fracking wells in western Pennsylvania to what the company terms “premium markets” in Canada. The project has been stalled since it was rejected by the New York Department of Environmental Conservation in April 2017. Since then, as National Fuel, the DEC, and the Federal Energy Regulatory Commission have fought in courts over the regulatory process, the company has sought to use eminent domain to seize land from holdouts who refused to grant access to their property for the pipeline.
M&T Bank and KeyBank are the largest and second-largest banks in Buffalo by deposits. Both banks are also each committed to lending tens of millions of dollars to National Fuel.
M&T and KeyBank are part of a syndicate of banks that have agreed to lend National Fuel up to $750 million through a credit agreement reached in October 2018. As part of that agreement, M&T has committed to lending up to $45 million to National Fuel, while KeyBank has committed to lending up to $62.5 million. KeyBank has also served as an underwriter on two recent National Fuel bond offerings, underwriting $24 million worth of bonds in 2017 and $17.25 million in bonds in 2018.
Bank of America is the third-largest bank in Buffalo – and second largest in the entire United States – by deposits. Bank of America has agreed to lend National Fuel up to $85 million as part of the company’s revolving credit facility.
Bank of America is one of the top five fossil fuel financiers in the world. According to a March 2019 report by Oil Change International and other environmental organizations, Bank of America lent $106.7 billion to fossil fuel companies from 2016 through 2018. As we reported in May, Bank of America is also closely involved with the multi-billion dollar Occidental Petroleum-Anadarko merger.
HSBC used to have a significant retail banking operation in Buffalo, but got out of the business for several years before recently opening new branches again. The UK-based bank is National Fuel’s biggest lender, pledging $85 million to the company’s revolving credit facility and underwriting $93 million in bonds ($24 million in 2017 and $69 million in 2018). HSBC provided $57.8 billion in financing for fossil fuel companies from 2016 through 2018, according to Oil Change International.
JPMorgan Chase and Wells Fargo are the top two fossil fuel financiers in the world, according to Oil Change International, lending $195.7 billion and $151.6 billion respectively to fossil fuel companies from 2016 through 2018. Each bank has agreed to lend National Fuel $85 million through its credit facility. Wells Fargo has underwritten $72 million in National Fuel bonds and JPMorgan Chase has underwritten $69 million.
Citizens Bank, Buffalo’s fifth-largest bank by deposits, has extended $21.5 million in credit and underwritten $21 million in bonds ($9 million in 2017 and $12 million in 2018) for National Fuel.
Many of these banks are also “major investors” in the Buffalo Niagara Partnership, the local chamber of commerce, and have governing roles on the executive committee of the organization’s board of directors. BNP reliably advocates for the interests of the fossil fuel industry over the environment.
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For years, the Buffalo Niagara Partnership lobbied the New York State government to permit hydraulic fracturing for natural gas drilling. In the years since fracking was officially banned by the Cuomo administration, BNP has made expanding pipelines and other fossil fuel infrastructure in New York State a priority. As we wrote recently in an article profiling the colleges and universities that back the Buffalo Niagara Partnership and its affiliates, BNP is currently lobbying against the Climate and Community Protection Act, an ambitious plan to decarbonize the New York State economy by 2050.
M&T Bank and KeyBank are both “Chairman’s Circle” members of the Buffalo Niagara Partnership. Bank of America is a “Director’s Circle” member, HSBC is a “Leadership Circle” member, and Citizens Bank, JPMorgan Chase, and Wells Fargo are all “Partnership Circle” members. Richard Gold, the President and Chief Operating Officer of M&T Bank, Gary Quenneville, the Upstate New York Regional Executive at KeyBank, and Kevin Murphy, the Northeast Regional Executive of Business banking at Bank of America all sit on the executive committee of the Buffalo Niagara Partnership board of directors alongside Donna DeCarolis, the President of National Fuel.
Financing the industry that is driving climate change and funding lobbying campaigns against climate action seem to go against these banks’ stated commitments to environmental sustainability. For example, according to M&T Bank’s website, the bank “is committed to being an environmentally conscious corporate citizen.” KeyBank says that “creating a sustainable community is essential to our mission.”
The fact that these banks are financing the companies directly responsible for the climate crisis – as well as funding a lobbying operation to undermine New York’s response to climate change – suggests that their sustainability claims are little more than marketing slogans meant to appeal to an increasingly environmentally-conscious customer base. Meanwhile, these banks are profiting off of their loans to National Fuel and other fossil fuel companies that are driving the climate crisis.