Royal Bank of Scotland will stop lending to energy companies that fail to align with the Paris climate agreement goals by 2021 as part of a corporate overhaul that will result in the bank being renamed NatWest Group, its biggest brand.
As part of a fresh strategy unveiled by the new chief executive, Alison Rose, the bank will stop lending and offering underwriting services to major oil and gas producers that do not have credible transition plan to help limit global heating to below 2C.
The group will also stop lending and offering underwriting services to companies with more than 15% of their activities related to coal unless they have similar plans prepared. RBS also pledged to fully phase out coal financing by 2030.
The parent company will forge ahead with its plan under a new name, ditching the RBS brand that was sullied by a string of scandals and a £45bn government bailout at the height of the 2008 financial crisis.
It came as the bank released its full-year earnings, which showed that 2019 pre-tax profits surged by 93% to £3.1bn from £1.6bn a year earlier. Its results were boosted by its disposal of a stake in the Middle Eastern bank Alawwal last year.
This is the third consecutive year of profit for RBS since its bailout in 2008.