Impact Of Green Credit On Commercial Bank’s Operating Performance

The society economy of China has been developing at a high speed,during which natural ecological problems can’t be ignored such as energy consumption and environment pollution.It is a social challenge of current economic development to change the way of development and promote the reform of supply-side.Effective management of environmental problems requires the participation of all social departments and resources.Commercial banks allocate credit resources by the way of financial tools,and play an increasingly important role in promoting the transformation and upgrading of industrial structure and building a green financial system as traditional financial institutions.As an important part of the green finance system,whether green credit can be actively and effectively carried out is directly influenced by the amount of economic benefits brought by it in some degree.Therefore,the study of green credit is greatly significant for the business performance of commercial banks theoretically and practically.This paper elaborates on the research background and significance first of all,and summarizes the existing research results and status based on the current domestic and foreign relevant literature,and puts forward to the research direction of the paper.Meanwhile,the definition of green credit,business performance and relevant theories of the subjects are also stated and analyzed,which lays a theoretical foundation for the writing of the following paper.Next,based on the operation and management principles of commercial banks,and the existing theoretical achievements of domestic and foreign scholars about the relationship between green credit and commercial performance,this paper defines business performance as a comprehensive economic index including profitability,asset quality,liquidity and growth,so as to analyze how the green credit business can affect the commercial banks’ performance.Afterwards,the overall situation of green credit business for the main commercial banks from different countries are analyzed according to the mentioned research direction.Given the availability of data and effectiveness of model analysis,as well as profitability,asset quality,liquidity and reputation,listed commercial banks have a higher comprehensive level among banking financial institutions in terms of empirical analysis.Faced with the great social responsibility and strict obligation for information disclosure,it is very crucial to the steady development of listed commercial banks to keep the operation of the overall economic and financial system steady.So this paper selects panel data of 17 listed banks including state-owned banks,joint-stock banks and urban commercial banks from 2011 to 2021 to empirically analyze the specific effects that green credit business can have on profitability,risk management level and liquidity of commercial banks.Conclusions can be drawn by The empirical and quantitative analysis for specific effects of green credit business on commercial banks’ profitability,risk management level,liquidity and growth.To begin with,it is beneficial to commercial bank to carry out green credit business,but the promoting effect is relatively limited.Secondly,green credit will increase the non-performing loan ratio of commercial banks leading to credit risk;Thirdly,green credit business has no obvious influence on the commercial banks’ liquidity;Fourth,green credit business can increase the proportion of commission income of commercial banks and promote the development of commercial banks.For the sake of promoting the green credit business of commercial banks further,This paper puts forward targeted countermeasures and suggestions from the perspectives of government departments,banking financial institutions and the public according to the above quantitative and qualitative analysis results.In terms of government departments,the measures including focusing on strengthening the transmission of green credit policies,improving the construction of green financial system and refining supervision and differentiated assistance.With respect to banking financial institutions,corresponding suggestions should be put forward from three dimensions,which mean applying innovative technology,strengthening data support and improving assessment system to promote the healthy development of green credit business.As far as the social public,relevant suggestions should be summarized from three ways of cultivating a well-ordered atmosphere,improving consciousness of the public about environmental protection,and guiding the green industry to adapt to the change of the market,which can improve the market environment,improve integrated green credit business of commercial bank management level and promote financial system development for commercial banks.