UBS and Credit Suisse remain big players in the business with oil – both directly and indirectly, says a new report by a non-government organization.
The two biggest Swiss banks, UBS and Credit Suisse, are major players in the oil trade of the Amazon region and, primarily, in Ecuador. UBS made $850 million available for the oil trade in Ecuador since 2009 and Credit Suisse even as much as $1.8 billion, according to a report jointly sponsored by Amazon Watch and Stand Earth.
The report was launched after a man-made catastrophe in April when a landslide damaged three oil pipelines in Ecuador. The damage to the pipelines released 2.5 million liters of oil into the Amazon river, polluting the shoreline, destroying fish stocks and damaging the fresh supply in the region.
Backing Up the Trade Deals
The two banks aren’t directly financing the oil business in the Amazon, which is organized via the traders based in Geneva. But their deals are being financed by the big banks. Amazon Watch and Stand Earth analyzed the freight documentation for the oil tanker to track the finances. The trading firms are using letters of credit pre-financed by banks to cover the purchases of the refineries.
UBS and Credit Suisse are granting loans worth billions of dollars to secure the oil deals by the traders, «Wochenzeitung» reported. Gunvor, a Geneva-based oil trader, received a credit worth $1.69 billion in November 2019 from a consortium of banks that included the big Swiss banks. Gunvor has strong interests in the oil trade in Ecuador.
Gunvor told finews.ch that the loan in question had nothing to do with oil trading.
Committed to Protecting the Environment
The two banks didn’t comment on the report. UBS told «Wochenzeitung» that it employed comprehensive environmental and social criteria to identify and assess ecological and social risks in the financing of raw materials’ business.
It had rejected the transaction that breached the bank’s standards, that included the protection of indigenous peoples’ land rights or Unesco world heritage sites.
Credit Suisse said it was committed to responsible business and carefully evaluated client activities. The bank also was accelerating the efforts to include sustainability aspects.
