We identify the effect of climate change-related regulatory risks on credit reallocation, Our evidence suggests that effects depend borrower's region, Following an increase in salience of regulatory risks, banks reallocate credit to US firms that could be negatively impacted by regulatory...

Using data on syndicated loans, we find that the introduction of a carbon tax is associated with an increase in domestic banks' lending to coal, oil, and gas companies in foreign countries. This effect is particularly pronounced for banks with large prior fossil-lending exposures, suggesting a...

Does banking supervision affect borrowers‘ transition to the carbon-neutral economy? We use a unique identification strategy that combines the French bank climate pilot exercise with borrowers‘ carbon emissions to present two novel findings. First, climate stress tests actively facilitate...