It joins all other major American banks – Goldman Sachs, Morgan Stanley, Chase, Wells Fargo, and Citi – who announced similar policies earlier this year.
“There’s been misunderstanding around our position, but we have not historically participated in project finance for oil and gas exploration in the Arctic,” Larry Di Rita, head of public policy for the bank, told Bloomberg on Monday.
“But given that misinterpretation, we’ve determined that it’s time to codify our existing practice into policy.”
Bank of America did not immediately respond to a request for comment from The Independent.
Last month, the Trump administration called for the oil and gas industry to submit proposals on where they would like to drill in the pristine refuge’s 1.6 million-acre coastal plain.
The administration is racing against the clock to finalize leases before Joe Biden takes office in January.
President-elect Biden is opposed to drilling in the refuge. His campaign platform called for permanently protecting the refuge and “other areas impacted by President Trump’s attack on federal lands and waters”. Mr Biden has also promised to ban new oil and gas permits on public lands and waters.
Industry analysts have been skeptical whether oil companies, or the financial institutions which back them for exploration, would be interested in the risk.
Bank of America has been under pressure from environmentalists, indigenous communities and its own shareholders to say that it would not fund drilling in the Arctic.
In November Trillium, which has a more than $3 billion in assets under management, questioned why the bank had not committed to rejecting funding oil and gas development, due to the “reputational risk” it posed “from the public, Capitol Hill, and the Gwich’in people of Alaska, not to mention a UN investigation…”
The Arctic wildlife refuge is a breeding ground for endangered polar bears and home to grey wolves, musk oxen and caribou, along with migratory birds from around the world.
The indigenous Gwich’in people have cited concerns for the Porcupine Caribou Herd on which they have relied for subsistence. The Gwich’in Steering Committee have been battling to protect the region from oil and gas companies for decades.
“The Trump administration has never even pretended to care about the Indigenous communities whose human rights would be threatened by the destruction of the coastal plain, but major financial institutions are listening to us,” said Gwich’in Steering Committee Executive Director Bernadette Demientieff.
“We will never stop fighting to protect the sacred calving grounds from destructive drilling, and we will prevail.”
Ben Cushing from the environmental organization, Sierra Club, said: “It has long been clear that drilling in the Arctic Refuge would trample Indigenous rights, threaten vulnerable wildlife, and worsen the climate crisis.
“Now that every major American bank has stated unequivocally that they will not finance this destructive activity, it should be clearer than ever that any oil company considering participating in Trump’s ill-advised lease sale should stay away.”