A team at SEB in Stockholm looked into the merits of carving out a separate unit at the lender into which fossil-fuel related assets could go. Once separated into a so-called bad bank, those assets could be sold at a discount. It's a model that Sweden is well known for managing successfully, as it did after its 1990s banking crisis.

And behind closed doors, some bankers across Europe have been kicking the idea around. But when it comes to fossil fuels, the SEB team decided that even a bad bank is a lost cause. The problem, according to SEB Chief Sustainability Officer Hans Beyer, is that "there is no natural holder" for such assets.

Figuring out what to do with the fossil-fuel assets that are increasingly falling out of favor is turning into an important part of the fight against climate change. Meanwhile, a growing number of investors have declared their intention to dump oil, gas and coal, with managers representing over USD 39tn  in client funds recently pledging to turn their backs on the asset class.