S&P Global — 14 January 2025
Daily Update: January 14, 2025
US Banks Withdraw From Climate Alliance Amid Political Pressure
By Nathan Hunt
Start every business day with our analyses of the most pressing developments affecting markets today, alongside a curated selection of our latest and most important insights on the global economy
The Net-Zero Banking Alliance was founded April 21, 2021, by 43 leading global financial institutions to leverage financial sector support for efforts to decarbonize the world's economy. Executives from Bank of America, HSBC and Santander celebrated the organization as an “example of leadership.” Less than four years later, all major US banks have withdrawn from the global alliance.
In December 2024, Wells Fargo, Citigroup, Morgan Stanley, Bank of America and Goldman Sachs withdrew from the coalition within weeks of each other. On Jan. 7, America’s largest bank, JPMorgan Chase, also withdrew, according to S&P Global Market Intelligence. None of the banks have offered any reasons for withdrawing.
"We will continue to work independently to advance the interests of our firm, our shareholders and our clients and remain focused on pragmatic solutions to help further low-carbon technologies while advancing energy security," JPMorgan said. "We will also continue to support the banking and investment needs of our clients who are engaged in the energy transition and in decarbonizing different sectors of the economy."
Republican attorneys general from 11 states recently launched a lawsuit against the world’s largest asset managers, accusing them of trying to shrink the US coal industry. Republican members of Congress have also warned banks that participation in the Net-Zero Banking Alliance may trigger antitrust concerns.
Following Wells Fargo's departure from the alliance, Texas Attorney General Ken Paxton urged other banks to withdraw, describing the organization as “hostile to our oil and gas industries." Following the withdrawal, Texas ended its review of Wells Fargo as a "potential boycotter of energy companies," which is prohibited under Texas law, and announced that government entities could resume business with the bank.
Republicans won control of both houses of Congress and the White House during the November 2024 elections. The incoming administration has signaled intent to encourage the expansion of US oil and gas through policy changes, withdraw the country from the Paris Agreement on climate change and roll back regulations on climate risk disclosures for investors.
Critics have accused banks of backsliding on their environmental commitments to accommodate climate deniers in the incoming administration.
Today is Tuesday, January 14, 2025, and here is today’s essential intelligence.
Load Growth to Help Offset Headwinds for Renewable Project Finance in 2025
Soaring electricity demand and strong power pricing will help soften the financial blow to US renewables developers from weakened federal incentives and proposed tariffs on key trade partners expected under the incoming Trump administration. Clean energy stocks have tumbled since the Nov. 5, 2024, election, reflecting investors' concerns that tax credits introduced in the Inflation Reduction Act (IRA) of 2022 will be pared back or eliminated. But thanks in part to unprecedented load growth, financing renewable energy projects should be business as usual in 2025, industry experts emphasized.
—Read the article from S&P Global Market Intelligence
Economic Research: Qatar Banking Sector 2025 Outlook: Resilient Performance to Continue
Qatari banks should remain profitable and benefit from strong capitalization and adequate liquidity, with an only modest drop in net interest margins owing to interest rate cuts. The system's external debt is about one-third of domestic credit but the expectation of lower funding needs and the government’s highly supportive stance toward its banking sector mitigates the risk of external debt outflows if geopolitical risk escalates.
—Read the article from S&P Global Ratings
As Los Angeles Wildfires Burn, Credit Implications for US Public Finance Issuers Are Unclear
Rapidly expanding wildfires in the Los Angeles area might pose significant financial and operational risks for rated entities, especially if not-for-profit electric utilities' infrastructure triggered the fires. S&P Global Ratings is monitoring rated US public finance entities in the affected region to assess whether liability claims or disrupted revenues will lead to negative rating actions.
—Read the article from S&P Global Ratings
Venezuelan Inauguration Seen as Possible Turning Point for US Oil Sanctions Policy
The Venezuelan people are bracing for chaos as both the incumbent President Nicolás Maduro and President-elect Edmundo González Urrutia prepare to be sworn in at the country's Jan. 10 inauguration, the outcome of which could prove to be a pivot point for US oil sanctions policy. In the days leading up to the inauguration, the military presence in Caracas grew and the atmosphere became increasingly tense.
—Read the article from S&P Global Commodity Insights
EU Aluminum Secondary Alloy Outlook Cloudy on Poor Economic Climate
Lackluster demand and overcapacity in Europe are expected to contribute to a tough environment for the European aluminum secondary alloys market in 2025, amid a weaker overall economic climate, while global competition for aluminum scrap is set to maintain pressure on prices, with large volumes headed to Asia. Market sources have raised concerns that this will continue to tighten the scrap availability in Europe, contributing to higher scrap prices across the year, and maintaining pressure on secondary aluminum alloy production margins.
—Read the article from S&P Global Commodity Insights
Listen: 2025 Ushers in Big Expectations for Sports, Streaming and Media M&A
Join Mike Reynolds and a trio of S&P Global Market Intelligence Kagan analysts in the latest episode of "MediaTalk," where they dive into the future of broadcast stations, cable networks and the sports business for 2025. As the media landscape continues to evolve, this episode offers critical insights into the potential for M&A activity, the impact of new Federal Communications Commission regulations and the ongoing shift to streaming platforms from traditional TV.
—Read the article from S&P Global Market Intelligence
Webinar: Beyond ESG with Sustainability Trends in 2025: Climate, Carbon and Capital (Jan. 22, 2025)
As we kick off 2025, much of the optimism and concern of 2024 continues, with markets seeking clarity on the energy transition, climate risk and sustainability opportunities. Join our first Beyond ESG webinar of the new year to unpack key trends.
—Register for the webinar from S&P Global Sustainable1