(Bloomberg) -- JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon met with Texas Attorney General Ken Paxton as the Republican official threatens to bar more banks from helping the state and its local governments sell bonds to raise funds for projects.  

Dimon and Paxton met in New York in April, according to a person familiar with the meeting who is not authorized to speak on the matter and asked not to be identified. Staffers in the attorney general’s office have been meeting with several bankers as they examine companies to determine whether they engage in a boycott of the oil and gas industry. Paxton has targeted members of the Net-Zero Banking Alliance, which includes JPMorgan. 

“Jamie meets with elected officials all the time, but his message has been consistent on Texas: JPMorgan Chase is committed to the state in the long-term and to helping Texas remain a top energy producer,” a spokesperson for the bank said in a statement. “We make independent business decisions and are not constrained by our memberships to any third-party organizations.”

The attorney general’s office did not respond to a request for comment.

JPMorgan is one of the five biggest underwriters in the US municipal bond market, according to data compiled by Bloomberg. So being labeled a boycotter of the fossil fuel industry would mark a major blow for its public finance department since Texas was the no. 1 market for muni-bond sales last year. 

Paxton’s office has the power to block most state and local debt sales because it is required to sign off on deals. Citigroup Inc. was banned from working on muni deals in Texas in early 2023 due to its firearm policies.

JPMorgan in 2021 joined the Net-Zero Banking Alliance, signing a pledge to align its lending and investment portfolios with net-zero emissions by 2050. The bank did so before the alliance became a major target of Republicans in red states. 

Paxton has said the alliance seeks to “starve companies engaged in fossil fuel-related activities of credit on national and international markets.” He announced in October that he was reviewing whether members of the alliance boycott the fossil fuels industry, raising the threat that more banks could be barred from working on Texas muni deals.  

The Texas attorney general’s staff has also met with public finance executives from Wells Fargo & Co. and RBC Capital Markets. Both banks are Net-Zero Banking Alliance members.

The alliance said in March that the group does not create binding obligations but instead offers guidance.

Paxton’s inquiries stem from a pair of Texas laws passed three years ago that seeks to limit state business with Wall Street over certain policies that involve firearms and fossil fuels. 

Dimon has been critical of the laws, saying that they threaten Texas’ business-friendly reputation. The state has repeatedly touted its ability to lure corporations with low taxes and a strong workforce. In a November interview with Bloomberg News, Dimon said it was a “mistake” to damage that reputation and maintained the bank does not “discriminate or boycott” any industry. 

A new report published on Monday from groups including Rainforest Action Network found that JPMorgan was the no. 1 fossil fuel financier in the world in 2023, and the New York bank has increased its funding to the sector year-over-year. 

©2024 Bloomberg L.P.