The united front that the global banking industry tried to present on climate change has crumbled. The Net Zero Banking Alliance (NZBA), its flagship initiative, has shut down permanently. The announcement of its immediate closure follows a devastating period of member withdrawals that exposed deep divisions and a lack of resolve within the sector.
This fragmentation was largely driven by political pressure originating in the United States. Donald Trump’s return to power on a pro-fossil fuel ticket, combined with an aggressive “anti-ESG” campaign from conservatives, made it politically hazardous for American banks to remain in a high-profile climate coalition.
The alliance was dealt a mortal blow when its six most powerful US members—JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, Goldman Sachs, and Morgan Stanley—all pulled out. This mass exit was a clear prioritization of domestic political concerns over the group’s international climate goals.
The departure of the American contingent triggered the alliance’s final decline. Without Wall Street’s participation, the NZBA lost its global authority. European and Japanese banks soon followed them out the door, and the recent resignations of UK giants HSBC and Barclays made the collapse official.
Now, the industry and climate advocates are left to pick up the pieces. Some are decrying the shutdown as a major setback, a sign that banks will retreat from their responsibilities when faced with a challenge. Others, however, see it as a necessary failure, arguing that the alliance was a weak, voluntary measure that distracted from the need for robust, mandatory regulation to truly decarbonize the financial system.