Disclosure is not the same as transformation.
Across eight major Asia Pacific economies, the banks that shape the region's energy future are financing clean power at a rate of 83 cents for every dollar they direct toward fossil fuels — a figure that trails the global average and has barely moved in three years. The gap between institutional climate commitments and actual capital flows reveals something older than policy: the difficulty of redirecting systems built over generations toward a horizon that demands urgency. With scientists calling for a 4:1 clean-to-fossil investment ratio this decade, and Asia Pacific currently sitting at 1.3:1, the distance between intention and transformation has never been more precisely — or more soberly — measured.
- Asia Pacific banks channeled only 83 cents into clean energy for every fossil-fuel dollar in 2024, falling below the global 0.89:1 benchmark and still short of recovering 2021 low-carbon financing volumes.
- The region processes roughly $240 billion in annual energy financing, yet movement between 2022 and 2024 was glacial — a handful of banks like MUFG, Mizuho, and Maybank improved their ratios, but these remain exceptions in a largely static system.
- Growth in low-carbon financing came not from wind or solar — which flatlined — but from power grids and energy storage, the infrastructure layer that makes renewables viable, with single large projects in the Philippines distorting national figures.
- Japanese banks illustrate the hidden architecture of the problem: a domestic clean-to-fossil ratio of 1.27:1 collapses when overseas fossil-fuel deals in North America and Southeast Asia are factored in.
- South Korea invested just 11 cents in domestic clean energy for every dollar spent importing fossil fuels, exposing a region structurally dependent on energy imports while its capital transitions at a pace the climate math cannot accommodate.
- Climate targets require a 4:1 low-carbon-to-fossil investment ratio this decade; Asia Pacific is at 1.3:1 — meaning the region would need to nearly triple its clean energy investment relative to fossil fuels, and fast.
In 2024, banks across eight major Asia Pacific economies — Japan, South Korea, Taiwan, Singapore, Malaysia, Thailand, Indonesia, and the Philippines — directed 83 cents toward clean energy for every dollar they put into fossil fuels. The number sounds like progress until measured against the global average of 89 cents, and against the deeper reality that low-carbon financing volumes had not yet recovered to 2021 levels, even as fossil-fuel deals continued to flow at a slower but steady pace.
The region moves roughly $240 billion in energy financing each year. Between 2022 and 2024, the clean-to-fossil ratio shifted, but barely. A handful of institutions — MUFG, Mizuho, Mega Financial Holding, Bank Mandiri, Maybank, Krung Thai Bank, and Kasikornbank — improved their ratios in 2023 and 2024. But these gains are exceptions. Where low-carbon money did grow, it bypassed wind and solar, which flatlined, and flowed instead into power grids and energy storage — the infrastructure that makes renewables viable at scale. In some markets, fossil-fuel financing shrank not from strategic retreat but simply because state energy companies like PTT and Pertamina had fewer refinancing needs that year.
The geography of capital complicates the picture further. Japanese banks achieved a domestic clean-to-fossil ratio above 1:1, but their overseas fossil-fuel lending in North America and Southeast Asia eroded that achievement globally. Domestic transition opportunities are growing in five of the eight markets studied — yet profitable fossil-fuel work abroad continues to absorb bank attention.
Zooming out to investment rather than financing, Asia Pacific (excluding mainland China) grew its energy transition spending by 23 percent in 2025 — well above the global 8 percent average. Yet the investment ratio stood at just $1.30 in low-carbon energy per dollar spent on fossil-fuel supply, against Europe's 3.5:1. South Korea invested only 11 cents in local clean energy for every dollar spent importing fossil fuels — a figure that captures the region's structural dependence on imported oil and gas.
Climate scientists have set the threshold: a 4:1 low-carbon-to-fossil investment ratio is required this decade to hold warming at 1.5 degrees. Asia Pacific, which imports heavily rather than producing fossil fuels domestically, needs an even higher ratio to compensate. It currently sits at 1.3:1. Some of the world's largest banks have adopted these financing ratios as benchmarking tools. Asia's banks are disclosing more, learning, and in some cases improving. But disclosure is not transformation, and the decade is not waiting.
The gap between what Asia's banks say they're doing for climate and what they're actually financing tells a story about the distance between intention and reality. In 2024, banks headquartered across eight major Asia Pacific economies—Japan, South Korea, Taiwan, Singapore, Malaysia, Thailand, Indonesia, and the Philippines—put 83 cents toward clean energy for every dollar they channeled into fossil fuels. It sounds like progress until you realize the global average is 89 cents, and that even this modest figure masks a deeper problem: low-carbon financing volumes in 2024 hadn't yet recovered to 2021 levels, while fossil-fuel deals continued to flow, albeit at a slower pace.
The region processes roughly $240 billion in energy supply financing annually. On paper, the trend looks encouraging. Fossil-fuel financing has declined gradually. Low-carbon transactions have risen, at least marginally. But the math reveals the stagnation. Between 2022 and 2024, the movement was glacial—enough to show some banks are trying, not enough to suggest the system is shifting. A handful of institutions did improve their ratios: Japan's MUFG and Mizuho, Taiwan's Mega Financial Holding, Indonesia's Bank Mandiri, Malaysia's Maybank, and Thailand's Krung Thai Bank and Kasikornbank all moved in the right direction in 2023 and 2024. Yet these gains remain exceptions rather than the rule.
Where low-carbon money did flow, it went to specific places. Wind and solar financing flatlined between 2023 and 2024. Instead, growth came from power grid infrastructure and energy storage projects—the backbone systems that make renewable energy viable at scale. In the Philippines, a single large battery and solar project skewed the entire country's numbers upward. In Thailand and Indonesia, fossil-fuel financing actually shrank, but not because banks suddenly abandoned oil and gas; it was simply that major state-owned energy companies like PTT and Pertamina had fewer refinancing needs that year.
The picture gets more complicated when you look at where banks are actually investing their money. Japanese banks, for instance, achieved a domestic ratio of 1.27:1—meaning they financed more clean energy than fossil fuels at home. But that achievement evaporated when you added in their deals elsewhere: fossil-fuel projects in North America and Southeast Asia pulled the global ratio down. This is the hidden architecture of the problem. Domestic transition opportunities are growing in five of the eight markets studied, yet banks are still finding profitable work in fossil fuels abroad.
The real crisis emerges when you step back and look at investment, not just financing. In 2025, Asia Pacific (excluding mainland China) invested 23 percent more in energy transition than the year before—a rate well above the global average of 8 percent. That sounds like momentum. But the investment ratio was just $1.30 in low-carbon energy for every dollar spent on fossil-fuel supply. Europe's ratio sits at 3.5:1. South Korea invested only 11 cents in local clean energy for every dollar it spent importing fossil fuels. The numbers reveal a region still structurally dependent on imported oil and gas, with domestic capital flowing toward transition at a pace that cannot possibly close the gap.
Climate scientists have calculated that a 4:1 investment ratio between low-carbon and fossil-fuel energy is required across this decade to keep warming at 1.5 degrees above pre-industrial levels. Asia Pacific needs an even higher ratio to compensate for the fact that it invests so little in fossil-fuel production domestically—meaning it must import, and import heavily. The region is currently at 1.3:1. The math is stark: Asia would need to nearly triple its clean energy investment relative to fossil fuels, and do so while simultaneously reducing its dependence on imported energy. The banks are disclosing their transition plans, some more thoroughly than others. But disclosure is not the same as transformation. The largest global institutions—JPMorgan Chase, Citigroup, Scotiabank—have adopted these financing ratios as benchmarking tools. Asia's banks are watching, learning, and in some cases improving. Yet the system as a whole remains locked in place, moving slowly when speed is what the decade demands.
Notable Quotes
Banks from the region have struggled to scale low-carbon transactions relative to fossil-fuel deals, reflecting inertia in the real economy and established financing strategies.— BloombergNEF analysis
The Hearth Conversation Another angle on the story
Why does it matter that Japanese banks financed more clean energy at home but then undid it with fossil-fuel deals abroad?
Because it shows the problem isn't ignorance or inability—it's incentive structure. A bank can hit its domestic targets and still be a net fossil-fuel financier globally. The system rewards that arbitrage.
So these banks are just moving the problem around?
Not just moving it. They're also revealing where the real money still is. Fossil fuels abroad are still profitable, still bankable. Clean energy at home is growing, but it's not yet the primary engine of returns.
The report mentions that power grids and storage grew while solar and wind flatlined. Isn't that still progress?
It's progress in the right direction, but it's also a symptom. Grids and storage are infrastructure—they're necessary, but they're not the same as building new renewable capacity. It's like investing in roads without building cars.
What about those banks that did improve their ratios—MUFG, Mizuho, Maybank? Are they the model?
They're moving faster than their peers, yes. But they're still operating within the same global system. Their improvement is real, but it's also marginal compared to what the decade requires.
The South Korea number is striking—11 cents per dollar of imports. How does a country even function that way?
It doesn't, not sustainably. That's the structural trap. You're dependent on imported energy, so you keep financing fossil fuels to secure supply, which makes you more dependent. Breaking that cycle requires simultaneous investment in domestic clean energy and import reduction. It's not just a banking problem.
So what would actually move the needle?
A shift in what's profitable. Right now, fossil fuels—especially imports—still generate the returns that justify the risk. Until clean energy deals become the primary source of bank revenue, the ratios will improve at the margins while the system stays fundamentally unchanged.