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The issuance of sustainability-linked loans (SLLs) has grown exponentially in recent years. Using a scoring methodology, we examine the underlying key performance indicators of a large sample of SLLs and analyze whether their design creates effective incentives for improving corporate...
Persistent link: https://www.econbiz.de/10013554919
Persistent link: https://www.econbiz.de/10014312842
As financial institutions and policymakers worldwide are considering how to integrate sustainability considerations throughout financial systems, a critical question is whether banks can effectively assess and monitor borrowers' environmental credit risk. China's green credit reforms, part of...
Persistent link: https://www.econbiz.de/10012899995
The "ESG lending" market, where loan contract terms are contingent on borrower ESG performance (i.e., ESG-linked loans), or where loans are issued for specific green projects (i.e., Green loans), has grown exponentially from $6 billion in 2016 to $173 billion in 2019. Much of this growth is...
Persistent link: https://www.econbiz.de/10013221136
impact of bank competition on corporate socially responsible (CSR) activities. We find strong and robust evidence that bank …
Persistent link: https://www.econbiz.de/10012862431
Both borrowers and lenders can be socially responsible (SR). Ethical banks commit to financing only ethical projects, which have social profitability but lower expected revenues than standard projects. Instead, no credible commitment exists for SR borrowers. The matching between SR borrowers and...
Persistent link: https://www.econbiz.de/10011705659
We review the recent academic and policy literature on bank loan loss provisioning (LLP) to identify several advances … smoothing, methodological issues in the bank loan loss provisions literature and the dynamic loan loss provisioning experiment …
Persistent link: https://www.econbiz.de/10012964664
information to bank loan lenders …
Persistent link: https://www.econbiz.de/10012841942
provisions estimate of banks. While bank credit risk teams are sometimes mesmerised by the short-term benefits of provisions … games, they do not care if their behaviour destroys bank value and the informativeness of loan loss provisioning estimates …. While it is not difficult for bank managers and analysts to understand that the provisioning process is subject to gaming …
Persistent link: https://www.econbiz.de/10012902590
likely to receive a bank loan, and their loans come with lower interest rates. These effects, however, are driven by banks …
Persistent link: https://www.econbiz.de/10013231975