Research On The Influence Of Green Credit On The Profitability Of Commercial Banks In China

In recent years,on the one hand,China’s ecological environment has been seriously deteriorated,and industrial production is still an important source of air pollution,resulting in huge demand for environmental protection investment.On the other hand,the asset scale of China’s banking financial institutions has increased steadily,while the asset quality and profitability have declined.In theory,the implementation of green credit business,on the one hand,is conducive to the sustainable development of commercial banks,provide new profit growth points for commercial banks,reduce the non-performing loan ratio,and optimize the asset quality of commercial banks;on the other hand,the green credit policy,can be effective truncation "two experience overcapacity" enterprise’s fund chain,enlarge enterprise financing costs,punishing the environment damage type enterprise,and not affect the market resource allocation efficiency,in order to promote China’s economic rights change the way of long,guide the transformation and upgrading of industrial structure,and achieve the harmonious sustainable development of economy and environment to provide the reality basis and approach.As a financial institution aiming at making profits,commercial banks are bound to pay attention to their own profits.How the green credit business will affect bank performance is related to whether the business can be recognized by banks and be carried out for a long time.Firstly,this paper theoretically analyzes the development status and influence mechanism of green credit in China,and then selects panel data of 14 representative listed commercial Banks in China from 2008 to 2017 to build a fixed effect model,and empirically studies the influence of green credit on commercial banks’ profitability.The conclusion shows that although there is a negative correlation between green credit and the profitability of China’s commercial banks at the present stage,there are multiple objective reasons for this result.In general,green credit matches the total scale of bank loans,and the driving degree of green credit on banks’ profitability still needs to be further explored.From the perspective of long-term sustainable development,green credit plays a great role in promoting the development of China’s green environmental protection industry.Therefore,in the end of this paper,combined with the actual situation of green credit development in China,some targeted countermeasures and suggestions are put forward,hoping to provide some reference value for the further development of green credit business in commercial banks.