Organizer: Bank of Finland
Location: Online Teams Meeting
Value-Driven Bankers and the Granting of Credit to Green Firms (co-authors: Di Bu, Yin Liao, and Steven Ongena)
Do bankers treat green firms differently, and if so, how? To address these questions, we analyze unique firm loan application and banker preference data from a mid-sized bank. We find customer managers (i.e., front-line bankers) give more favorable recommendations on the loan applications of green firms. Greenness matters more when applications are handled by managers with more intense green values. Brown managers ‘’virtue-signal’’ greenness on green loan applicants when their recommendations do not matter and shade their recommendations when they do. Brown loan officers, who are the managers ‘superiors, push back on managers’ recommendations on green applications by downgrading them.
Online Research seminars organized by the Bank of Finland's Research Unit are open to all researchers interested in the subjects covered. Those wishing to attend a seminar are kindly asked to register in advance, by filling in the Online Registration Form.
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Xiang Li Halle Institute for Economic Research and Martin Luther University of Halle-Wittenberg
Twin Instabilities: Evidence from German Banks (Co-author: Dan Su (Cheung Kong Graduate School of Business))