Our Climate Strategy

We recognise the importance of our role in achieving a net-zero transition of our clients and the real economy by 2050. With this responsibility, the Group continues to strengthen its climate strategy, aligning capital allocation and financing with credible transition pathways. The transition to a net-zero world requires all actors to adjust – for banks, this means evolving lending criteria, managing phase-outs of carbon intensive activities, engaging with clients on their transition journeys, and reorienting capital flows towards sustainable solutions. By acting in alignment with best business practices[MŠ1] , NLB Group supports a consistent pathway for the wider economy and reinforces its ambition to be a regional leader in climate action.

By the end of 2023, NLB Group reaffirmed its commitment to net zero through its first Net-Zero Disclosure Report, setting emission-reduction targets for four key sectors – Power Generation, Iron & Steel, Commercial Real Estate, and Residential Real Estate – alongside a coal exclusion policy and a financing target of EUR 1.9 billion in sustainable finance by 2030.

Building on this foundation, the Second Round of Portfolio Targets set in 2025 expanded both coverage and ambition. Portfolio coverage increased from 25% in the 1st Round to a cumulative 51% in the 2nd Round, with our commitment expanded to include Road Freight Corporates, Leasing (Passenger Cars), and Agriculture, along with remodelled baselines for Real Estate.

New approaches have been introduced, including sector-specific emission intensity targets, financing commitments, and client engagement targets tailored to data maturity and transition readiness. Throughout, NLB Group continues to rely on science-based pathways, including IEA NZE 2050, SBTi, and national NECP scenarios, ensuring credibility and alignment with the 1.5°C trajectory set out in the Paris Agreement.

As NZBA member, NLB has committed to individually setting initial emission reduction targets covering certain carbon-intensive sectors within 18 months of joining. Following this, the Bank published its second-round report, reflecting targets set after 36 months of membership. Target setting required a cross-functional collaboration within the Bank to set credible and actionable targets, which supported the internal mainstreaming of net-zero transition planning.