Impact of Green Central Bank Collateral Policy: Evidence from the People’s Bank of China

Camille Macaire and Alain Naef

No cmwpn, SocArXiv from Center for Open Science

Abstract: In June 2018, the People’s Bank of China (PBoC) decided to include green financial bonds into the pool of assets eligible as collateral for its Medium Term Lending Facility. We measure the impact of the policy on the yield spread between green and non-green bonds, or greenium. Using a difference-in-differences approach to compare pairs of green and non-green bonds issued by the same institutions, we show that the policy increased the greenium by 46 basis points. This experience can be useful to other central banks considering similar polices.

Date: 2021-02-19
New Economics Papers: this item is included in nep-cba, nep-env and nep-mon
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:osf:socarx:cmwpn

DOI: 10.31219/osf.io/cmwpn

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