Green Finance and Bank Performance: Evidence from Bangladesh

The severe repercussions of the global climate catastrophe are being felt all across the world. Each industrialized and developing country must take action in response to the consequences of global climate change that endanger life on our planet. This study looks into how green finance has affected Bangladeshi private commercial banks' financial performance. For eight years, from 2014 to 2021, all private commercial banks are surveyed quarterly for secondary data. The performance of the banks is evaluated using return on assets, return on equity, net interest margin, and net non-performing loan to total loan ratios, whereas green finance is used as an independent variable. The study uses linear regression and questionnaire analysis to deter- mine the impact of green finance on a bank’s financial performance. According to the study, at a 10% significance level, green finance has a negligible positive effect on return on assets but a significant positive impact on return on equity, net interest mar- gin, and net non-performing loans to total loan ratio. The questionnaire analysis also demonstrates green finance's significant impact on banks’ performance. This study can be used as a starting point for policy discussions with practitioners, governments, decision-makers, academics, and future researchers.