Bank of America creates environmental banking team
NEW YORK (Reuters) - Bank of America Corp, the second-largest U.S. bank, is creating an environmental banking group focused on finding and financing ways to promote conservation and reduce global warming, Chief Executive Kenneth Lewis said on Tuesday.
Lewis also called on Congress to create a cap-and-trade framework to limit carbon dioxide emissions and allow the trading of allowances, favoring clear federal standards and a market-based mechanism to set emission values.
Presidential candidates Barack Obama, Hillary Clinton and John McCain all support a cap-and-trade system that would allow large polluters such as oil companies and power producers to trade emission credits with companies that pollute less.
In prepared comments to the North Carolina Emerging Issues Forum in Raleigh, North Carolina, Lewis said the environmental group will be led by Richard Cohen, a managing director in strategic investments and head of environmental strategic investments, and begin operations in the coming months.
Last March, Charlotte, North Carolina-based Bank of America said it will commit $20 billion over 10 years to support growth in environmentally-friendly activities and to reduce global warming.
"Our $20 billion initiative isn't charity by any stretch. We expect an attractive risk-adjusted return on this capital," Lewis said in his speech.
"Bank of America is involved in financing the green economy for a lot of good reasons," he added. "It represents the future, and a tremendous business opportunity. We believe it's what our customers and clients need us to do to support them."
Lewis said Bank of America has, like other banks, decided to assess the cost of carbon in risk and underwriting processes in evaluating business models of utility companies.
He also said the bank is looking at participating in "large-scale leasing" of residential solar panels to homeowners, especially if federal incentives for their use were adopted, but hasn't "found the right way to participate."
Bank of America plans next year to open what it calls the "world's greenest skyscraper" just east of New York's Times Square, and is developing a green office tower in Charlotte.
(Reporting by Jonathan Stempel; Editing by Tim Dobbyn)