An AR-15 on display at the 2024 NRA Annual Meeting
An AR-15 on display at the 2024 NRA Annual Meeting / Stephen Gutowski

Bank of America Walks Back Gun Lending Ban

One of the country’s largest financial institutions is reversing course on AR-15s and other popular firearms.

Bank of America backed off its blanket ban on lending to companies that manufacture what it has labeled “military-style firearms,” Bloomberg first reported Friday. Going forward, the bank will resume lending to firearms companies on a case-by-case basis subject to “enhanced due diligence,” according to its latest Environmental and Social Risk Policy (ESRP) Framework.

Bill Haldin, a spokesperson for Bank of America, confirmed the change in policy in a statement to The Reload.

“Certain client relationships or transactions that carry heightened risks go through a due diligence process that involves senior level risk review,” he said. “We recently detailed that in our updated risk policy framework.”

The about-face comes as Republican-led states are increasingly turning up the heat on financial institutions and other businesses that adopt environmental, social, and governance (ESG) policies they argue target legal firearms and energy production. Gun commerce, in particular, has become a flashpoint in recent years as major banks like Bank of America, JPMorgan, and Citibank publicly cut off funding to businesses that sell certain firearms and accessories. In response, Republicans in states like Texas and Florida have shown an increased willingness to use new government regulations to combat those practices.

Haldin did not respond to a request for comment on whether the political backlash drove Bank of America’s decision. However, Bloomberg reported that anti-discrimination laws passed in Texas and Florida played a significant role, citing a person familiar with bank officials’ thinking.

Adopted in 2021, Texas’s SB19 became the country’s first “non-discrimination” policy for firearms businesses. The law prohibits government entities from contracting with companies that have policies restricting gun companies. Texas Attorney General Ken Paxton (R.) found Citibank’s policy of refusing to do business with companies who sell “large capacity” magazines was discriminating against the gun industry and forced the financial giant out of a $3.4 billion bond deal in the state.

Florida Governor Ron DeSantis (R.) signed a similar law last year. The Sunshine State’s version requires banks to attest that they don’t “politically discriminate by denying credit or accounts based on an applicant being a lawful gun owner, maker, or dealer in order to do business with Florida government entities.

The firearms industry responded to Bank of America’s policy change with cautious optimism.

“We are encouraged by Bank of America’s announcement that it will no longer pursue a ‘woke’ policy of discriminating against members of our industry merely because they make and lawfully sell products Americans desire to purchase,” Larry Keane, Senior Vice President of the National Shooting Sports Foundation, told The Reload. “We hope they are sincere and this is not a publicity stunt.”

Keane added that the bank’s move is “validation” of laws like those in Texas and Florida that “address this pernicious pattern of discrimination by financial service and insurance companies, among others.”

The political fight over banking for gun businesses has been ongoing for at least a decade. The Obama Administration’s 2013 “Operation Chokepoint” scandal, for instance, saw the government pressure financial institutions not to do business with gun and ammunition suppliers–often without evidence of wrongdoing. Meanwhile, Bank of America’s former policy, and the similar policies adopted by its competitors, was announced in 2018 in response to the Marjory Stoneman Douglas high school shooting in Parkland, Florida.

“We have just a handful of manufacturers. They know what our intentions are,” Anne Finucane, then-vice chairman at Bank of America, said at the time. “It’s our intention not to finance these military-style firearms for civilian use.”

Bank of America’s policy now describes its “arms and munitions” business as a social area of “heightened sensitivity” requiring special review moving forward.

“Any client or transaction involving the manufacture of military-style firearms for non-law enforcement, non-military use must be escalated to the senior-level risk committee for decisioning,” the bank’s latest ESRP report reads.

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Created by potrace 1.16, written by Peter Selinger 2001-2019

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Created by potrace 1.16, written by Peter Selinger 2001-2019

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