Banco do Brasil sets sights on 100% renewable energy by 2025

Banco do Brasil plans to source 100% of the energy it consumes from renewable power generation, mostly solar, by 2025, CEO Fausto Ribeiro said during the CIAB Febraban banking technology event.

At present, around 22% of the bank’s electric power comes from renewable sources, Ribeiro said, speaking on a panel focused on ESG and sustainability.

The inclusion of this topic on the agenda of the traditional financial technology event illustrates the importance that ESG has gained in the sector. 

Earlier this year, Banco do Brasil outlined a new agenda with 10 long-term commitments, based on sustainable business, responsible investments and ESG in general, Ribeiro said. 

As part of this agenda, the bank also wants to expand its credit portfolio aimed at sustainable agriculture to 125bn reais (US$25.2bn) by 2025. 

The bank currently has around 100bn reais in credit lines for agriculture, most of which are focused on sustainable farming, through the Pronaf program and the low-carbon agriculture program (ABC), among others.

Banco do Brasil is also committed to reaching 15bn reais in renewable energy credit by 2025 for every customer segment, up from the current 5.9bn reais, he added.

The bank has 261bn reais in its green credit portfolio certified by Sitawi Finanças do Bem, a non-profit focused on financial infrastructure for the social and environmental sectors in Brazil. That figure represents around 30% of all the bank’s sustainable credit, according to Ribeiro.

In his opinion, one of the major challenges that banks face when it comes to ESG is consolidating a long-term, sustainability-oriented leadership mindset.

“We have to worry about training our leaders. We increasingly need to prepare the leaders who will succeed us with this vision,” he said.

Overall, Banco do Brasil's total loan portfolio, which includes the classified loan portfolio, private securities and guarantees, amounted to 758bn reais at the end of 1Q21, up 2.2% over the previous quarter and growth of 4.5% year-on-year, driven by retail and agribusiness operations.

The full agribusiness loan portfolio (loans plus securities and guarantees) reached 199bn reais of that total (up 3.6% year-on-year), with rural credit up 3.2%.