By Dominic Chopping

STOCKHOLM--Swedish bank Skandinaviska Enskilda Banken AB said Wednesday it has updated its fossil fuel investment policies, laying out plans to phase out exposure to some industries and introducing a financing cap on others.

SEB said it has for several years excluded financing of, among other things, new coal-fired power plants, but the updated sector policy on fossil fuels has a wider scope and also includes a roadmap for how SEB will phase out its exposure to coal and to unconventional oil.

It also strengthens SEB's guidelines regarding environmentally sensitive areas such as the Arctic, it added.

The bank said it will continue to gradually reduce its credit exposure to fossil fuels within the oil-and-gas sector by applying a cap to exploration, production and oilfield services activities. This cap is lowered annually.

SEB said it will support its customers in meeting the Paris Agreement through an orderly transition and where possible could finance renewable energy and new technology.

"We shall support our customers to transition according to the UN Development Goals and the Paris Agreement," says Hans Beyer, SEB's Chief Sustainability Officer.

"The transition that is necessary will require large investments, and as a bank, we have a responsibility to participate and finance that transition."

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

02-24-21 0358ET