- A Nordic Center for Sustainable Finance report says nine major Nordic banks provided about US$4.9bn in financing and hold about US$6.0bn in investments tied to fossil-fuel expansion from mid-2022 to mid-2024.
- DNB, SEB and Nordea account for roughly 95% of the expansion loans, with Nordea lending over US$400m to coal-linked firms despite its net-zero alliance role.
- SEB disputes the report’s methodology while citing steep cuts in upstream oil and gas exposure and rapid growth in sustainability-related financing.
- The controversy lands amid a broader credibility crisis for the Net-Zero Banking Alliance as rules loosen and members exit, raising greenwashing and regulatory-risk concerns.
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The latest research from the Nordic Center for Sustainable Finance underscores a paradox: while many Nordic banks have publicly committed to aligning with the Paris Agreement and joining net-zero coalitions, their recent actions—including lending and investing in companies expanding fossil fuel production—continue to undercut those promises. Between mid-2022 and mid-2024, 9 prominent Nordic banks provided nearly US$5 billion in financing for expanding fossil fuel operations, and hold an additional US$6 billion in investments in firms scaling up production. This suggests that even as headline ESG and transition-aligned targets proliferate, capital flows inconsistent with a 1.5°C pathway persist.
DNB, SEB, and Nordea are central outliers. Together, they account for 95% of loans granted for expansion, and DNB plus Nordea represent 60% of the fossil investment exposure among the nine banks. Nordea’s coal exposure alone exceeds US$400 million and persists despite its status in the NZBA Steering Group. Meanwhile, SEB’s response to criticism highlights measurable progress: a marked reduction in upstream oil & gas exposure, falling fossil share in its energy portfolio, and strong growth in sustainability-aligned financing. That said, SEB disputes the methodology used in “Banking on Thin Ice III,” particularly classifications that fail to distinguish between pure fossil projects vs. mixed companies also engaging in clean energy transitions.
These patterns gain significance as the backdrop of weakening institutional norms: the NZBA has seen global exits, altered criteria (lowered thresholds), and erosion of accountability mechanics. Triodos, among others, objected to revised guidance that softens requirements for members, particularly regarding 1.5°C alignment and disclosure mandates—driving its exit. This institutional slippage risks elevating greenwashing and diminishing investor trust.
Strategic implications are urgent for banks, investors, and regulators alike. Banks with large fossil-fuel expansion exposures face increasing reputational, regulatory, and transition risks, especially as scientific and political pressure intensify. Investors—both institutional and retail—may reallocate capital toward banks with more credible transition strategies. Regulators in the Nordics, EU, and beyond may step up disclosure requirements, impose stricter alignment tests, or even penalize non-compliance. Key open questions include: how quickly banks like DNB, SEB, and Nordea will set and meet interim transition targets; whether NZBA’s shifting criteria will survive scrutiny; and whether regulatory regimes will fill the gap left by weakening voluntary coalitions.
Supporting Notes
- New data show that from July 2022 to June 2024, nine Nordic banks provided ~US$4.9 billion in financing to coal, oil, gas producers that are expanding production, and have US$6.0 billion in investment exposure to such firms. [Primary]
- DNB, SEB, and Nordea contributed ~95 % of the total loans to fossil-fuel expanders; DNB and Nordea account for ~60 % of the investment exposure; Nordea alone has provided over US$400 million in coal lending. [Primary]
- Projects financed include Arctic oil exploration threatening sensitive ecosystems, a proposed coal mine in the Czech Republic with potential 60 million tonnes CO₂e emissions, and the EACOP pipeline project displacing ~100,000 people and destroying endangered habitats. [Primary]
- SEB states it reduced upstream oil & gas exposure by over 75 % between 2019 and end-2024; fossil share of its energy portfolio dropped from 59 % to 30 %; sustainability-related financing rose ~175 % since 2021. [Related source]
- Triodos Bank exited NZBA in April 2025 because NZBA’s revised guidance dropped strict requirements on 1.5 °C alignment and made targets more voluntary. [Related]
- NZBA has reportedly disbanded or suspended activity by October 2025, amid widespread exits by major banks. [Related]