Research On The Motivation And Effectiveness Of Issuing Green Financial Bonds Of CD Bank

In recent years,China’s green bond market has grown rapidly,but how to make up for the gap in green fund demand is a problem that needs to be solved urgently.As far as green bond issuers,state-owned enterprises and commercial banks with financial strength are the main subjects,while local commercial banks have a cautious wait-and-see attitude towards green bonds,and hence the overall issuance volume is still relatively small.In reality,the motivation of small and medium-sized commercial banks to issue green bonds is not only related to the regulatory policies on the fund raising and investment requirements of green bonds,but also related to the evaluation standards and technical difficulties of green bonds,the cost of banks to implement investigation and supervision,which also has an important impact on the effectiveness of issuance.Based on the introduction of research background,relevant theoretical foundation and the overview of China’s green bond market,this thesis firstly analyzes and points out the problems in the green bond issuance market of commercial banks in China,namely,less long-term bond issuance,less perfect information disclosure,less participation of local commercial banks and lack of evaluation and certification by third-party institutions.Further,as a typical representative of small and medium-sized commercial banks and the first bank-based green bonds in Sichuan Province,CD Bank’s issuance motives are found to include both economic benefits with given risks and non-economic motives such as responding to the national green development policy,serving the local green economy and assuming social responsibilities.Regarding the impact of issuing green bond on CD Bank,the study shows that: in terms of economic benefits,the issuing of green bond not only deceases directly the financing cost of CD Bank,but also has indirect benefits such as 14.49% reduction in total capital costs,28.24% increase in profitability,32.89% increase in growth capacity,and 0.2% reduction in non-performing loan ratio.In terms of environmental benefits,in the six projects including waste incineration projects,hazardous waste resource utilization projects,sewage treatment projects and urban water supply projects to be invested by CD Bank’s green bond proceeds,not only biochemical and chemical oxygen demand are significantly reduced,but also suspended matter,ammonia nitrogen,total nitrogen,total phosphorus and other emission substances are substantially reduced.