Ethical bank, “European banks are more profitable and more climate conscious than mainstream banks”

ROME – Ethical European banks are more profitable than average banks mainstream and are pioneers in measuring and reducing the impact on the climate: this is what emerges from the “Fifth report on ethical finance in Europe“which will be presented to the European Parliament on 12 October. The report, published by Banca Etica Group in collaboration with Febeathe European Federation of Banks and gods Ethical and Alternative lenders, compares the main financial data of the 24 European ethical banks with those of the aggregate of approximately 4,500 banks operating in the Eurozone, on the basis of data provided by the European Central Bank. “In the ten years up to 2020, ethical banks were on average twice as profitable as traditional ones in terms of ROE – says Anna Fasano, president of Ethical Bank – their deposits during the pandemic grew by more than 15% in 2020 compared to 2019 “.

The 25 ethical banks analyzed. The report shows how they exclusively finance projects with positive social and environmental impacts and are structurally different from traditional banks. Ethical banks use a banking approach that relies on customer relationships for both credit and savings and focus on the real economy, while mainstream banks are much more dedicated to financial activities (investments in securities, services financial, etc.). In 2020, loans to individuals and businesses represented on average 72.98% of total assets for ethical banks, but only 36.96% for the European banking system.

At the forefront of CO2 measurement. As the report shows, ethical banks are also at the forefront of measuring the CO2 emissions generated indirectly by their loans. “Banks generally measure Scope 1 and 2 emissions, produced by the heating systems of their offices or by the consumption of electricity – says Mauro Meggiolaro, analyst at Ethical Finance Foundation – only recently have some traditional banks begun to measure and disclose the emissions of Area 3, generated by loans to businesses and individuals. Ethical banks – he added – were among the first in the world to disclose data on Scope 3 issues of their financial and credit portfolios, according to the principles of the PCAF (Partnership for Carbon Accounting Financials). This is essential for carrying out scenario analyzes, setting goals, taking action and disseminating progress towards decarbonisation. ”

“This is why the Ethical Banks must be treated differently”. “The report highlights a number of reasons why ethical banks should be treated differently from a regulatory perspective, both at European and national level,” continues Fasano. “Ethical banks had no responsibility in the 2008 financial crisis, but the regulation was tightened for them too. The legislator made no difference between the different types of banks. As a result, ethical banks are now subject to a disproportionate amount of rules designed for mainstream banks that were at the origin of the banking crises and risk seeing their flexibility in responding to the needs of cooperatives and social enterprises, environmental organizations and Third sector“.

The interventions in Brussels. The report will be presented and discussed in Brussels at the European Parliament on 12 October from 4 to 6 pm in the Spinelli 1E1 room. Speakers:

Peru Sasia, president of FEBEA

Anna Fasano, president of Banca Etica.

Adriana Kocornik-Mina, Head of Metrics and Research at the Global Alliance for Banking on Values ​​and member of the PCAF Steering Committee.

Patrizia Toia (S&D) and Ernest Urtasun (Verdi / EFA), MEPs

Victor Meseguer, director of Social Economy Europe,

Federica Ielasi, University of Florence and in the Board of Ethics Sg

What is the Ethical Bank. It is a Group that offers a complete range of financial services that combine economic efficiency with cultural, environmental and human promotion. Ethical Finance Foundation And Fundación Finanzas Éticas are the cultural foundations of the Group in Italy and Spain. They promote research and study activities on ethical finance issues, critical analyzes and proposals for alternatives to the rules and practices of the financial world and study and awareness-raising initiatives on critical finance education. It is the first and still the only Italian bank entirely dedicated to ethical finance, it has been operating for 23 years throughout the national territory. It has 46,000 shareholders and 82 million of share capital. It is also present in Spain as Fiare Banca Etica. Banca Etica adheres to the main international networks of ethical finance. Ethics Sgr is the Group’s asset management company, the only one in Italy that places ethical mutual funds. CreSud offers financial resources and support services to microfinance organizations, fair and sustainable trade producers, associations and NGOs in Latin America, Africa and Asia.

What is FEBEA. It is the European Federation of Ethical Banks and Alternative Lenders, which brings together 33 financial institutions from 15 European countries, with the aim of developing and promoting the principles of Ethical Finance. FEBEA’s goal is to develop ethical and social finance in Europe, through the activities of its members and its own initiatives. FEBEA defends a committed, rigorous and ambitious vision of social and ethical finance.