The banking sector is a pillar of the world’s economic fabric and is today facing a major revolution due to the demands of sustainable development objectives and the evolution of sustainable finance tools. This article analyses the impact of green credit on commercial banks’ performance based on data from 10 commercial banks in China between 2012 and 2022. The study found that in the short term, the implementation of green credit has a positive effect on the income level of commercial banks’ intermediate activities and a moderating effect on their return on total assets and non-performing loan ratio.

1. Ahamed, M.M., Ho, S.J., Mallick, S.K., R. Matousek. (2021). Inclusive banking, financial regulation and bank performance: Cross-country evidence. Journal of Banking & Finance, 124 (2021), Article 106055, 10.1016/j.jbankfin.2021.106055
2. Al-Qudah, A.A., Hamdan, A., Al-Okaily,A., Al-Okaily, M.,M., and L. Alhaddad. Alhaddad (2023). The impact of green lending on credit risk: evidence from UAE’s banks. Environ. Sci. Pollut. Res., 30 (2023), pp. 61381-61393, 10.1007/s11356-021-18224-5
3. Cao, C., Qibo, C., Lili, Z. (2024). Corporate Greenwashing Unexpectedly Caused by the Green Credit Policy: A Comparison between Environmental Sustainability Information Disclosure and Actual Environmental Protection Investment from China’s Listed Companies. Sustainability,Vol. 16, https://doi.org/10.3390/su16177369
4. Caselli, S., G. Corbetta, D. Cucinelli, M. Rossolini. (2021). A survival analysis of public guaranteed loans: Does financial intermediary matter?Journal of Financial Stability, 54 (2021), Article 100880, 10.1016/j.jfs.2021.100880
5. Chaaben, N., Z. Elleuch, B. Hamdi, B. Kahouli. (2022). Green economy performance and sustainable development achievement: empirical evidence from Saudi Arabia. Environ. Dev. Sustain. (2022), 10.1007/s10668-022-02722-8.
6. Chao, T., Xiuqing, L., Liming, X., Bangzhu, Z. (2022). Exploring the impact of green credit policy on green transformation of heavy polluting industries, Journal of Cleaner Production, Vol.335, https://doi.org/10.1016/j.jclepro.2021.130257.
7. Chenguel, M. B., & Mansour, N. (2024). Green finance: between commitment and illusion, Competitiveness Review, Vol. 34 No. 1, pp. 179-192. https://doi.org/10.1108/CR-10-2022-0162.
8. Feng, Y., Yuxi, P., Chuanwang, S., Junyi, N.(2024). Assessing the effect of green credit on risk-taking of commercial banks in China: Further analysis on the two-way Granger causality, Journal of Cleaner Production, Vol.437, https://doi.org/10.1016/j.jclepro.2024.140698.
9. Fikri, A. F. & Zaenal, A. (2024). The impact of green credit distribution on bank performance and influencing factors: a case study of Indonesian banks, International Journal of Research in Business and Social Science, Center Centre for the Strategic Studies in Business and Finance, vol. 13(1), pp. 323-332.
10. Galàn, J.E., Y. Tan. (2022). Green light for green credit? Evidence from its impact on bank efficiency International Journal of Finance and Economics, 1-20 (2022), 10.1002/ijfe.2697.
11. Gao, X., & Guo, Y. (2022). The Green Credit Policy Impact on the Financial Performance of Commercial Banks: A Quasi-Natural Experiment from China. Hindawi, Mathematical Problems in Engineering, https://doi.org/10.1155/2022/9087498.
12. He, Z., W. Wei. (2023). China’s financial system and economy: a review. Annual Review of Economics, 15 (2023), pp. 451-483, 10.1146/annurev-economics-072622-095926
13. Lai, X., Yue, S., H. Chen. (2022). Can green credit increase firm value? Evidence from Chinese listed new energy companies. Environ. Sci. Pollut. Res., 29 (2022), pp. 18702-18720, 10.1007/s11356-021-17038-9
14. Lepetit, L., & Strobel, F. (2015). Bank insolvency risk and Z-score measures: A refinement. Finance Research Letters, vol.13, pp.214–224
15. Li, J., Xiangyuan, G., Qiwei, X., Xiaolei, S. (2024). Green credit efficiency of commercial banks in China: Evidence from a multi-period leader-follower model with preference, liInternational Review of Financial Analysis, Vol.96, Part A, https://doi.org/10.1016/j.irfa.2024.103604.
16. Li, L., L. Qiu, F. Xu, X. Zheng. (2023).The impact of green credit on firms’ green investment efficiency: Evidence from China. Pacific-Basin Finance Journal, 79 (2023), Article 101995, 10.1016/j.pacfin.2023.101995
17. Li, Y. (2023). Role of banking sector in green economic growth: empirical evidence from South Asian economies. Economic Change and Restructuring. Vol. 56, https://doi.org/10.1007/s10644-023-09499-4
18. Li, Y., Liao, M., Y. Liu (2023). How does green credit policy affect polluting firms’ dividend policy? The China experience. International Review of Financial Analysis, 88 (2023), Article 102631, 10.1016/j.irfa.2023.102631
19. Lian, Y., Gao, J., Ye, T. (2022). How does green credit affect the financial performance of commercial banks? - Evidence from China, Journal of Cleaner Production, Vol.344, https://doi.org/10.1016/j.jclepro.2022.131069.
20. Liu, X., Q. Ji, J. Yu. (2021). Sustainable development goals and firm carbon emissions: Evidence from a quasi-natural experiment in China. Energy Economics, 103 (2021), Article 105627, 10.1016/j.eneco.2021.105627
21. Mansour, N. (2023). Green banks in Tunisia: Issues and challenges. Journal of Infrastructure, Policy and Development 7(2): 2099. doi: 10.24294/jipd.v7i2.2099.
22. Mansour, N. (2025). Global climate geopolitical competition and Africa’s position. Journal of Infrastructure, Policy and Development. 9(1): 10435. https://doi.org/10.24294/jipd10435.
23. Moshood, O., Tawanda, Z., John, A. A., Khadija, O.S., Oluwatobi, D-O., Abiodun, Ismail, L., Manoj, K. (2024). Advancing toward sustainability: The emergence of green mining technologies and practices, Green and Smart Mining Engineering, Vol.1, https://doi.org/10.1016/j.gsme.2024.05.005.
24. Niangjijia, N. (2022). Emerging green industry toward net-zero economy: A systematic review, Journal of Cleaner Production, Vol.378, https://doi.org/10.1016/j.jclepro.2022.134622.
25. Oleg, B., Subal, C. K., Ana, L. V. (2021). Achieving a sustainable cost-efficient business model in banking: The case of European commercial banks, European Journal of Operational Research, Vol.293, Issue 2, pp. 773-785, https://doi.org/10.1016/j.ejor.2020.12.039.
26. Ozili, P. K. (2019). Non-performing loans and financial development: New evidence. Journal of Risk Finance, Vol. 20, pp. 59–81.
27. Ozili, P. K. (2022). Economic policy uncertainty, bank nonperforming loans and loan loss provisions: Are they correlated?. Asian Journal of Economics and Banking, Vol. 6, pp. 221–235.
28. Ozili, P.K. (2024), “Sustainable development and bank non-performing loans: are they correlated?”, Arab Gulf Journal of Scientific Research, Vol. 42, No. 3, pp. 551-565. https://doi.org/10.1108/AGJSR-01-2023-0028
29. Rahman, M.H., Junaid, R., Tipon, T., Miguel, A. E. (2023). Green banking initiatives and sustainability: A comparative analysis between Bangladesh and India, Research in Globalisation, Vol.7, https://doi.org/10.1016/j.resglo.2023.100184.
30. Rohit, A., Shruti, A., Ashutosh, S., Anil, K., Sunil, L., Vranda, J. (2024). Adoption of green finance and green innovation for achieving circularity: An exploratory review and future directions, Geoscience Frontiers, Vol.15, https://doi.org/10.1016/j.gsf.2023.101669.
31. Salas, M., Lamothe, P., Delgado, E., Angel, L., Fernández, M., Lucia, V. (2024). Determinants of Nonperforming Loans: A Global Data Analysis. Computational Economic, https://doi.org/10.1007/s10614-023-10543-8
32. Shen, Q., Pan, Y., Y. Feng. (2023). The impacts of high-speed railway on environmental sustainability: quasi-experimental evidence from China. Humanit Soc Sci Commun, 10 (2023), pp. 1-19, 10.1057/s41599-023-02135-6
33. Simona, G., Sebastiano, M., Valeria, N., Andrea, P. (2024). A PRISMA systematic review of greenwashing in the banking industry: A call for action, Research in International Business and Finance, Vol. 69, https://doi.org/10.1016/j.ribaf.2024.102262.
34. Song, J., Cao, W., and Shan, Y.G. (2024). Green credit and bank’s risk-taking: evidence from China, International Journal of Managerial Finance, https://doi.org/10.1108/IJMF-03-2024-0144
35. Sumei, L., Shenghui, Y., Guangyou, Z. (2021). Does green credit improve the core competence of commercial banks? Based on quasi-natural experiments in China, Energy Economics, Vol.100, https://doi.org/10.1016/j.eneco.2021.105335.
36. Tian, G., Kun, T., Wang, Y. W. (2023). Does the market value the green credit performance of banks? Evidence from bank loan announcements, The British Accounting Review, https://doi.org/10.1016/j.bar.2023.101282.
37. Udeagha, M. C., & Ngepah, N. (2023). The drivers of environmental sustainability in BRICS economies: Do green finance and fintech matter?, World Development Sustainability, Vol. 3, https://doi.org/10.1016/j.wds.2023.100096.
38. Wang, H., W. Cao, Y. Wang. (2022).Green Financial Policy and Commercial Bank Risk Taking: Mechanism, Characteristics, and Empirical Research 143–160
39. Wang, X., Q. Wang. (2021). Research on the impact of green finance on the upgrading of China’s regional industrial structure from the perspective of sustainable development. Resour. Pol., 74 (2021), Article 102436
40. Wenna, F., Feng, W., Hao, Z., Bin, Y., Rui, L., H. Jiang. (2024). Is climate change fueling commercial banks’ non-performing loan ratio? Empirical evidence from 31 provinces in China, International Review of Economics & Finance,Vol. 96, Part A, https://doi.org/10.1016/j.iref.2024.103585.
41. Xie, Q., Q. Xu, L. Chen, X. Jin, S. Li, Y. Li. (2022). Efficiency evaluation of China’s listed commercial banks based on a multi-period leader-follower model, Omega, 110 (2022), Article 102615, 10.1016/j.omega.2022.102615
42. Xie, W. (2020). Research on the Impact of Green Credit on the Financial Performance of Commercial Banks. Financial Engineering and Risk Management, Vol. 3, pp. 127-136 Clausius Scientific Press, Canada. https://doi.org/10.23977/ferm.2020.030119
43. Yan, T., X. Xu, R. Senchun. (2019). Green Credit and Bank Financial Performance: Based on the Perspective of Institutions, Technology and Institutions. Jiangxi Social Sciences, Vol. 39(7), pp. 63-72.
44. Yao, F., Z. Qin, X. Wang. (2023). The influence of bank governance structure on green credit. PLoS One, 18 (2023), Article e0281115, 10.1371/journal.pone.0281115
45. Zhou, X.Y., Caldecott, B., Hoepner, A.G., Y. Wang. (2022). Bank green lending and credit risk: An empirical analysis of China’s green credit policy. Business Strategy and the Environment, 31 (4) (2022), pp. 1623-1640, 10.1002/bse.2973