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French asset manager gave bond warning to State Bank of India over coal mine

In spite of a growing public backlash, one of the State Bank of India’s investors, French giant Amundi, has announced that it will sell off its SBI green bonds if the bank’s executives grant a A$1bn loan to Adani’s Carmichael coal mine.

Director of the Institutional Corporate Clients division & ESG, Jean Jacques Barberis said, “We consider SBI should not finance this project. It’s their decision, ultimately, but we’ve been extremely clear on the fact that, if they decide to do it, we would immediately disinvest.” Some analysts believe Adani’s coal project will struggle to ever make a profit, with any loan to the Carmichael mine carrying significant financial risks. The lack of economic case for the loan combined with the scale of the destruction the project is causing. It means that SBI’s global reputations and that of its investors and business partners is at grave risk if the loan goes ahead.

Amundi, which holds the bond in its Amundi Planet Emerging Green One fund, said it had learnt this week that the Indian bank was considering financing the Carmichael thermal coal mine in Australia. The Amundi fund – the largest aimed at green bonds in the emerging markets – looks to invest in bonds that help fund environmentally friendly projects, but also looks at the issuer to make sure its other activities are “coherent”.

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