Green Loans in Bank Portfolio: Financial and Marketing Implications

Vera Mirovic, Branimir Kalas, Ines Djokic (), Nikola Milicevic, Nenad Djokic and Milos Djakovic
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Vera Mirovic: Department of Financial and Banking Management, Faculty of Economics in Subotica, University of Novi Sad, 24000 Subotica, Serbia
Branimir Kalas: Department of Financial and Banking Management, Faculty of Economics in Subotica, University of Novi Sad, 24000 Subotica, Serbia
Ines Djokic: Department of Trade, Marketing, and Logistics, Faculty of Economics in Subotica, University of Novi Sad, 24000 Subotica, Serbia
Nikola Milicevic: Department of Trade, Marketing, and Logistics, Faculty of Economics in Subotica, University of Novi Sad, 24000 Subotica, Serbia
Nenad Djokic: Department of Trade, Marketing, and Logistics, Faculty of Economics in Subotica, University of Novi Sad, 24000 Subotica, Serbia
Milos Djakovic: Department of Financial and Banking Management, Faculty of Economics in Subotica, University of Novi Sad, 24000 Subotica, Serbia

Sustainability, 2023, vol. 15, issue 7, 1-14

Abstract: Banks represent important subjects in business, with dominant positions in the financial system in the world. Banks developed various financial products and services that can cover most market needs. As a result of adequate portfolio diversifications, banks recorded positive profitability rates. In addition to being adjusted to competition, banks should also focus on the environment. Therefore, banks have recognized an opportunity to offer green products and services and support environmentally-friendly initiatives and projects. The aim of this paper is to identify whether crucial determinants of bank profitability are moderated by the presence of green loans in the bank portfolio. For this purpose, a panel fixed-effects approach was applied to data from the Republic of Serbia (2014–2021). The obtained results indicate that the presence of green loans in a bank’s portfolio moderates the influences of a bank’s liquidity on the bank’s profitability measured by return on assets (ROA) and return on equity (ROE). The contribution of the conducted research is that it is, according to the authors’ knowledge, the first measurement and estimation of the moderating effects of green loans’ presence in banks’ portfolios on their profitability. In addition to financial, marketing implications were considered.

Keywords: green loans; bank profitability; panel data analysis; financial implications; marketing implications (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:15:y:2023:i:7:p:5914-:d:1110312

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