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Illustration: Sarah Grillo/Axios

JPMorgan Chase said Monday that it won’t directly finance new oil and gas development in the Arctic and will significantly curtail its financing of the extraction and burning of coal.

Why it matters: JPMorgan is the world’s largest funder of fossil-fuel companies, according to a report by the Rainforest Action Network (RAN). The announcement follows similar moves by other big banks and investment firms, including Goldman Sachs and BlackRock.

Driving the news: Timed to the company’s annual investor day on Tuesday, the announcement includes many parts — though restriction of fossil-fuel financing is potentially the most impactful.

  • The bank is prohibiting all kinds of direct financing worldwide for new or existing coal plants, unless the plants use technology to capture carbon dioxide emissions (which remains prohibitively expensive in most instances).
  • Earlier policies said the company wouldn’t finance coal plants or mines in developed countries only.
  • The company is restricting most services — including lending and access to capital markets — to companies that get most of their revenue from coal mining, and it's setting a 2024 goal to phase out remaining credit exposure to those companies.

The big picture: Grassroots and investor activists have been targeting major corporations, including JPMorgan, for their support of the fossil-fuel industry through protests and shareholder resolutions. This pressure is rising as governments fail to act and the world remains heavily reliant upon these fuels.

  • JPMorgan economists warned recently of "catastrophic outcomes" if climate change isn't adequately addressed, according to a client note viewed by the BBC.

By the numbers: JPMorgan is the largest lender to the oil, natural gas and coal industries, according to RAN.

  • The bank loaned $196 billion to fossil-fuel companies between 2016 and 2018, according to the RAN report.
  • That’s nearly a third higher than the bank that ranks second, Wells Fargo.

But, but, but: The restrictions affect a small portion of the company’s fossil-fuel businesses, according to Jason Opeña Disterhoft, a senior campaigner on these issues for RAN.

  • The biggest new restriction is on financing for companies whose businesses are more than 50% coal mining, which amounts to less than 0.6% of its overall $196 billion lending to the sector over the last three years, according to Disterhoft.
  • “The hard restrictions in this new policy only affect a small portion of their fossil lending,” Disterhoft told Axios Monday.
  • The restrictions don’t touch other major parts of the sector, such as pipelines outside of the Arctic, natural gas and oil sands.

One level deeper: The bank is also announcing it will finance $200 billion worth of projects supporting the United Nations’ sustainable development goals. Many (but not all) of those projects are related to climate change, though $50 billion is going toward green initiatives explicitly, per the company.

Go deeper: Goldman Sachs moves away from Arctic oil and coal

Go deeper

Mike Allen, author of AM
7 hours ago - Politics & Policy

Biden adviser Cedric Richmond sees first-term progress on reparations

Illustration: "Axios on HBO"

White House senior adviser Cedric Richmond told "Axios on HBO" that it's "doable" for President Biden to make first-term progress on breaking down barriers for people of color, while Congress studies reparations for slavery.

Why it matters: Biden said on the campaign trail that he supports creation of a commission to study and develop proposals for reparations — direct payments for African-Americans.

Cyber CEO: Next war will hit regular Americans online

Any future real-world conflict between the United States and an adversary like China or Russia will have direct impacts on regular Americans because of the risk of cyber attack, Kevin Mandia, CEO of cybersecurity company FireEye, tells "Axios on HBO."

What they're saying: "The next conflict where the gloves come off in cyber, the American citizen will be dragged into it, whether they want to be or not. Period."

Cedric Richmond: We won't wait on GOP for "insufficient" stimulus

Top Biden adviser Cedric Richmond told "Axios on HBO" the White House believes it has bipartisan support for a stimulus bill outside the Beltway.

  • "If our choice is to wait and go bipartisan with an insufficient package, we are not going to do that."

The big picture: The bill will likely undergo an overhaul in the Senate after House Democrats narrowly passed a stimulus bill this weekend, reports Axios' Kadia Goba.