The UK's first Green Investment Bank will be based in London and Scotland, Business Secretary Vince Cable has announced.
The Welsh Government had put in a bit for the bank to be located in Cardiff, which is intended to encourage private sector investment in "green" projects
But the city was rejected at the very first stage, for "not meeting the level of performance" set out in the review.
Both opposition parties and the Welsh Government have reacted with disappointment at the news.
Welsh Conservative sources questioning how hard or otherwise Welsh Govt fought for Green Investment Bank because 'Cardiff had v strong case'
A Welsh Govt source:'Yesterday it was Remploy, today it's the Green Investment Bank. What have the Tories and Lib Dems got against Wales?'
More top news
Is transport a barrier to work for Valleys communities?
The Welsh Government has invested £2.5 million in a new purpose designed facility for St Asaph-based company Qioptiq.
Surfers were targeted by the two men as they headed into the water and left personal belongings and valuables unattended.