Westpac’s commitment to help limit global warming to less than 2C does not mean it is going to stop investing in coal projects soon.

Australia’s oldest bank has agreed to judge lending proposals according to how they conform to the UN’s climate change target of restricting global temperatures, but will not rule out investment in individual sectors.

“It’s very hard to see how scientists could say one particular project could push us over two degrees,” Westpac’s chairman, Lindsay Maxsted, said at Friday’s annual general meeting in Sydney.

“We believe in the science of climate change and we absolutely believe in trying to limit global warming to two degrees, that is a given ... [but] it’s very difficult for us to conceive of a situation where a scientist would say: ‘That particular project will take us over the edge.’ ”

National Australia Bank has ruled out funding Adani’s controversial Carmichael coal mine in Queensland but Westpac said it would continue to judge each project on merit.

“We will not be pulling out of coal or any industry per se,” Maxsted said. “We will be supportive of coal companies provided they fit into our criteria.”

Questioned by shareholders, including Australian Geographic Society’s young conservationist of the year, Amelia Telford, Maxsted said coal companies needed to show they were taking steps to reduce their environmental impact to secure Westpac finance.

The development of so-called clean coal technology, and a need to supply emerging economies, meant it was not practical to pull out of coal entirely, he said.

Protesters were outside the meeting calling for the bank to rule out financing Adani’s Galilee basin coal projects.

Westpac has the least exposure to fossil fuel projects of Australia’s big four banks. It has lent $5.9bn across 59 fossil fuel deals since 2008, compared with ANZ’s $12.6bn across 99 deals, figures compiled by the tracking body Market Forces show.

Maxsted said 61% of Westpac’s energy lending went towards renewables but he would not give a timetable for a further move away from fossil fuel investments.

The bank’s chief executive, Brian Hartzer, told the meeting that the bank fully backed the aim of the UN’s climate talks in Paris.

Negotiators in Paris are thrashing out the final details of a global agreement that aims to cut emissions with the aim of limiting global warming to the UN’s 2010 target of 2C, or lower.