UK Bank Coal Financing Rose 17% Since 2021
Financial institutions increased coal exposure even as EU counterparts slashed their lending portfolios.
Updated on Oct. 7, 2026 in Financial Services
Live Poll
Should major banks be restricted from financing coal-related projects to meet climate goals?
UK-based banks funneled $8.3 billion into the coal industry between 2021 and 2026, marking a 17% increase in financing during that period. This trend contrasts with the broader European market, where banks reduced coal-related capital support by 46% since 2021.
Why it matters
The divergence between UK and EU bank portfolios creates complex credit access environments for operators in energy-intensive sectors. As some institutions increase sector exposure while others formalize phase-out policies, businesses must anticipate shifting costs and capital availability.
UK banks channeled $8.3 billion into coal financing between 2021 and 2026, while global coal financing averaged $117 billion annually between 2022 and 2025. Chinese institutions led this volume, accounting for 62% of the global total.
The players
Barclays
A multinational universal bank providing investment and retail services globally.
HSBC
A global financial services organization with a large footprint in trade finance.
The details
Researchers tracking 744 commercial banks analyzed lending and underwriting activities across mining, power generation, logistics, exploration, and trading. While UK institutions like Barclays increased coal financing from $1.2 billion in 2022 to $1.6 billion in 2025, HSBC has committed to phasing out thermal coal-fired power and mining financing by 2030 in EU and OECD markets.
Timeline
Between 2021 and 2026, UK banks provided $8.3 billion to the coal industry.
Barclays coal financing reached $1.6 billion in 2025, up from $1.2 billion in 2022.
Global coal financing averaged $117 billion annually from 2022 to 2025.
Market Landscape
The uptick in UK coal financing marks a notable departure from the institutional divestment trend seen across much of Europe. It stands in contrast to long-term commitments intended to align banking portfolios with the decarbonization goals of the Paris Agreement.
Operators in energy-heavy industries should monitor their lenders' specific coal exposure policies, as these can affect future loan terms and covenants. Anticipate that banks with active phase-out commitments may apply stricter ESG reporting requirements for industrial borrowers.
The takeaway
Diverging lending strategies mean that sector-wide capital availability is no longer a reliable signal for individual business planning. Businesses should audit their banking relationships to confirm if lenders have formal transition plans that could impact long-term credit access.
Further reading
For broader trends in industry capital, visit the Financial Services sector hub.
Source note: This article includes information reported by RocketNews.
Live Poll
Should major banks be restricted from financing coal-related projects to meet climate goals?
