京都大学 大学院経済学研究科・経済学部

タイトル:
“CAMELS and Green Gold: Do green bonds affect Banks performance?”　Akihiro Omura

Abstract:
Green bond issuance by banks has emerged as a strategic financial tool to fund environmentally sustainable projects and align with regulatory and sustainability objectives. However, the impact of green bond activities on bank performance remains contested. Contributing to the literature on climate finance and banking performance, this paper investigates how green bond issuance influences financial outcomes under the CAMEL framework, encompassing Capital adequacy, Asset quality, Management efficiency, Earnings, and Liquidity. The CAMEL framework provides a comprehensive evaluation of a bank’s overall financial health and operational soundness, making it an ideal tool to assess the multidimensional impacts of green finance initiatives. We find that green bond issuance is associated with lower short-term profitability, as evidenced by negative impacts on return on average assets (ROAA), return on average equity (ROAE), and net non-interest income. Simultaneously, green bonds contribute to improved risk management, with reductions in reserves for loan losses and non-performing loans. These findings suggest that green bond issuance reduces credit-related vulnerabilities while enhancing financial stability. Additionally, banks engaging in green activities demonstrate greater resilience through stronger capital adequacy and higher net interest income, highlighting their ability to withstand economic and market shocks. Our findings underscore a trade-off between short-term returns and long-term stability. This trade-off highlights the dual role of green bond issuance: reducing immediate profitability but bolstering risk mitigation and resilience.