Green financing and the relationship between banks and non-financial corporations through the lens of balance sheet interaction

Conference paper

Harrison, M. and Shabani, M. 2025. Green financing and the relationship between banks and non-financial corporations through the lens of balance sheet interaction . New insights from financial statements. Bank of Spain, Madrid, Spain 17 - 17 Oct 2024 Bank for International Settlements (BIS).
AuthorsHarrison, M. and Shabani, M.
TypeConference paper
Abstract

Green investment is a crucial element in the transition towards achieving lower emissions on a global scale. Non-financial corporations (NFCs) have a pivotal role in the transition process by investing in green projects together with banks in providing the necessary finance. This paper uses a novel dataset which includes all the green financing transactions between banks and NFCs in all countries in the European Economic Area (EEA), United Kingdom (UK), and Switzerland for the period between 2014-2024. Our analysis focuses on examining the factors that explain the demand side for green financing, which reflects the NFCs, and the supply side, which reflects banks as the providers of green finance. Our empirical results suggest that there are distinct differences in the factors that determine the amount and preference for green finance and relate to the size of NFCs as well as the sectors in which they operate. Similarly, banks' balance sheet variables also explain their supply of green finance and their likelihood to issue loans or bonds.

Year2025
ConferenceNew insights from financial statements
PublisherBank for International Settlements (BIS)
Publisher's version
License
File Access Level
Anyone
Publication dates
Online28 Aug 2025
Publication process dates
AcceptedSep 2024
Completed17 Oct 2024
Deposited01 Sep 2025
ISSN1991-7511
Book titleNew insights from financial statements: Proceedings of the workshop on "New insights from financial statements" co-organised by the European Committee of Central Balance Sheet Data Offices (ECCBSO), the Bank of Spain and the Irving Fisher Committee (IFC) in Madrid, Spain, 17 October 2024
ISBN978-92-9259-874-7
Web address (URL) of conference proceedingshttps://www.bis.org/ifc/publ/ifcb65.htm
Web address (URL)https://www.bis.org/ifc/publ/ifcb65_06.pdf
Copyright holder© Bank for International Settlements 2025
Additional information

The paper is available on the BIS website free of charge: www.bis.org.

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