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Kentucky wants to divest from Citigroup and JP Morgan Chase because it thinks they’re too hostile to fossil fuels, despite reports they’re the top lenders in the industry

Kentucky treasurer Allison Ball put companies in ‘narrow financial institution’ list compiled in accordance with state law, saying they are engaged in “energy company boycotts.”

The legislation, reminiscent of actions taken by Republican-led states including West Virginia and Texas, will require state entities to divest from blacklisted companies, with some exceptions.

“When corporations boycott fossil fuels, they intentionally suffocate the capital lifeblood for Kentucky’s distinctive industries,” Ball said in a press release. publication on Tuesday.

The move is the latest in the GOP’s fight against what Republicans perceive as liberal-leaning financial practices. The strategy known as environmental, social and governance investment has attracted close scrutiny as critics say it is part of a larger democratic effort to prioritize climate change and other social issues at the expense of the fossil fuel industry.

Ball said in an interview that the law won’t stop the banks on the list from underwriting most of Kentucky’s municipal debt. This has emerged as a major concern in Texas, one of the country’s largest markets for such sales. He said the Kentucky law is a “different situation” than the Texas law.

Ball also said it’s too early to estimate how much money could be at risk from divestment.

JPMorgan and Citigroup were among the top lenders to the fossil fuel industry in 2021, according to a relationship by groups including the Sierra Club and the Rainforest Action Network.

“The fact is, we are among the largest lenders to the US traditional and renewable energy industries, including Kentucky, where we serve some of its largest energy and utility companies,” said Trish Wexler, JPMorgan spokeswoman, in a statement. statement sent by email. . “We believe our business practices are in line with Kentucky law and hope that a deeper look at these facts will lead to a reconsideration.”

BlackRock said the firm’s “sole focus” is to deliver the best financial results for its clients.

“On behalf of our customers, we have invested approximately $276 billion in energy companies globally,” BlackRock spokesman Christopher Van Es said in an emailed statement. “BlackRock does not boycott energy companies and will continue to be an investor across the energy sector.”

Mark Costiglio, a spokesman for Citigroup, declined to comment.

Kentucky government agencies have 30 days to notify both the Treasurer’s office and the corporations of any holdings. The named institutions have 90 days from that time to “cease engaging” in boycotts to avoid divestment, according to a notice on the Treasurer’s website. Listed companies will have the opportunity to “clarify” whether they boycott energy companies.

Government entities are required to sell, redeem, surrender or retire all publicly traded securities of companies that continue the boycott within one year, although the law makes some exceptions, such as if divestment would result in a loss.

The Full list of firms is lower:

BlackRock, Inc.BNP Paribas SACitigroup Inc.Climate First BankDanske Bank A/SHSBC PLCJPMorgan Chase & Co.Nordea Bank ABPSchroders PLCSvenska Handelsbanken ABSwedbank AB

–With assistance from Silla Brush.