Singapore: DBS, UOB, OCBC funding coal projects, compromising on global warming issue

A logo of the United Overseas Bank Limited (UOB) Reuters

While global banks avoid putting funds for any kind of coal projects due to pollution and climate concern, Singapore's top banks DBS, Oversea-Chinese Banking Corporation (OCBC) and United Overseas Bank (UOB) have taken the opposite direction to finance the mine stations of the region.

In terms of the source of carbon dioxide, which has caused the rise of global warming in the planet, coal is considered one of the major sources of it.

While talking about the investment, Singapore based banks have said that they will investigate the situation first to avoid any kind of environmental harm and then they will proceed with the funding process, which is also required for electricity in the region.

According to an Australian financial green group called Market Forces, who conducted the study on banks and their investment to coal project, said that DBS Bank, OCBC and UOB have invested $2.98b into 21 coal projects since 2012.

According to the findings, in this case, OCBC was the top financier, as they invested almost $1.14b in 14 coal deals. DBS has given about $885m in 12 projects.

UOB was enlisted as the third lender, as they provided a financial support of $262m to five other deals. In 2014, they also refinanced the Newcastle Coal export terminal expansion with $92m.

In Vietnam also DBS has funded the construction of four 1,200 MW coal-fired power plants and has become the financial adviser for other deals in Indonesia.

According to the study, Singapore banks justify their investment policy by saying that the millions of people need energy. But on the other hand, world banks have reduced the financial involvement with coal industries.

In 2017, while HSBC has announced no more financing for coal projects in rich nations, Deutsche Bank also avoided investment in any coal-fired power plants.

Already from record-breaking high temperature to chilly weather, Singapore is facing drastic climate change. So the country has declared that 2018 is the year when they should take actions for the changing weather, as the country has to show its progress to reach the deal of 2015 Paris Climate Agreement, signed by 200 nations to take responsibility of reducing the global warming to less than 2 degree Celsius.

This article was first published on January 20, 2018