Research On Green Credit Performance Of Commercial Banks In China

With the development of industrialized society,environmental pollution and climate change are becoming increasingly prominent,and guiding green,low-carbon and sustainable development has become a demand for China’s economic and social development.The financial sector is the main force supporting the development of the real economy and plays an important role in promoting the green transformation and development of China’s economy and serving the development of green industries.Green credit,as a financial tool to adapt to new development needs,has been widely used in practice,and the scale and business share have shown a rising trend year by year,and has become the main source of funds for emerging green industries,but there are problems such as low short-term economic benefits and insufficient enthusiasm of commercial banks.Commercial banks are both microeconomic subjects that conduct green credit business and market subjects whose main business goal is profitability,so whether conducting green credit business contradicts commercial banks’ business goal of pursuing profitability is a question that needs to be explored in depth.Therefore,this paper takes the green credit business of commercial banks in China as the main research object,and analyzes and explores what kind of impact green credit business has on the business performance of commercial banks from the theoretical and practical levels.At the theoretical level,based on theories of externality,environmental and social risks,corporate social responsibility and existing research literature,we analyze the mechanism of green credit business on the business performance of commercial banks and its possible effects from four aspects:cost-benefit,risk mitigation,refinancing pricing and brand reputation.At the practical level,the development history and status of green credit in China are sorted out and summarized,and the types of green credit products are introduced.It is found that the scale of green credit is growing and the product and business systems are becoming more and more complete,but there are obvious differences among different banks.In order to objectively assess the impact of green credit business on the business performance of commercial banks and the differences in the effects on the business performance of different types of commercial banks,this paper selects the panel data of 14 commercial banks from 2008-2019 as the sample,uses the bank’s return on net assets as the explanatory variable,the green credit balance as the explanatory variable,and macroeconomic indicators and bank financial indicators as the control variables,construct the model and conduct empirical tests.Meanwhile,the total sample is divided into state-owned commercial banks and joint-stock commercial banks,and the regression analysis is conducted separately for the total and grouped samples,and subsequently,the regression is conducted again using the lagged one-period green credit balance data.Through the study,it is found that: first,in the current period,the growth of commercial banks’ green credit balance has a negative impact on their business performance,indicating that green credit increases commercial banks’ business costs in the short term and reduces current operating income,which is detrimental to the growth of commercial banks’ business performance.Second,in the current period,green credit of large state-owned commercial banks and joint-stock commercial banks has the same direction of negative impact on their operating performance,indicating that the advantages of state-owned banks in terms of volume,cost of capital,and business capacity do not show up in their green credit performance in the current period.Third,in the lagged period,the impact of green credit balance on commercial banks’ operating performance is still negative,indicating that green credit has not yet formed a scale benefit in the industry and its contribution to the improvement of commercial banks’ operating performance is limited.Fourth,in the lagged period,the impact of green credit on the operating performance of different types of commercial banks is in different directions,i.e.,the impact of green credit on the operating performance of state-owned commercial banks is in a negative direction,and the impact on the operating performance of joint-stock commercial banks is insignificant,indicating that the difference in business capabilities of the two types of banks is reflected in their green credit performance.Combining the research content and findings,in order to better promote the development of green credit and enhance the operating performance of commercial banks,this paper suggests that（1）the green financial policy framework needs to be further improved and the legalization of the green credit system needs to be promoted;（2）a comprehensive evaluation system covering financial institutions,enterprises and other market players should be constructed from three levels: environmental dimension,social dimension will and corporate governance dimension;（3）Improve the incentive and restraint mechanism of green credit to improve the enthusiasm of commercial banks to carry out green credit business;（4）give full play to the role of monetary and fiscal policies to improve the business performance of commercial banks;（5）implement differentiated green credit policies according to the size and type of commercial banks;（6）appropriately reduce the risk weight of green credit assets and give full play to the green credit’s asset structure to commercial banks optimization and risk resolution function of green credit to commercial banks;（7）enhance the synergy effect among green financial products and play the role of market mechanism in the optimal allocation of resources.