Green finance in Banking sector: analysis of green bonds in European banks

Abstract

Green finance offers economic and environmental benefits worldwide. Green finance increases access to environmentally friendly goods and services for individuals and businesses, balancing the transition to a low-carbon society and resulting in more socially inclusive growth. Green bonds have emerged as a crucial component of sustainable development. While previous studies have examined the role of financial institutions in sustainable finance, they have often been hindered by limited data availability. In our research, we conduct a comparative analysis of five European banks, focusing on their green bond issuance and highlighting the most significant projects funded through these bonds. Our findings reveal sectors within the green economy that have experienced notable growth, with a particular emphasis on the substantial increase in green bond issuance, particularly in the energy efficiency sector during 2021. The insights derived from our research not only assist market participants in making informed decisions but also provide valuable guidance to policymakers in promoting green finance. By shedding light on the achievements and impact of financial institutions in the realm of green finance, our study contributes to the advancement of both the market and policy landscape.