Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh

Green financing is a relatively new phenomenon in Bangladesh’s banking sector following its introduction in 2011 by the Central Bank of Bangladesh. All 56 schedule banks in Bangladesh are required to adopt the green financing policies as part of the effort to promote environmentally friendly practi...

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Main Authors:	Julia, Taslima, Kassim, Salina
Format:	Article
Language:	English English English
Published:	IIUM Press 2016
Subjects:	H Social Sciences (General) HG Finance HG1501 Banking
Online Access:	http://irep.iium.edu.my/55542/ http://irep.iium.edu.my/55542/1/012%20Al-Shajarah%20Taslima.pdf http://irep.iium.edu.my/55542/2/55542_Green%20financing_WOS.pdf http://irep.iium.edu.my/55542/9/55542_Green%20financing%20and%20bank%20profitability_scopus.pdf

id	iium-55542
recordtype	eprints
spelling	iium-555422017-10-10T05:20:37Z http://irep.iium.edu.my/55542/ Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh Julia, Taslima Kassim, Salina H Social Sciences (General) HG Finance HG1501 Banking Green financing is a relatively new phenomenon in Bangladesh’s banking sector following its introduction in 2011 by the Central Bank of Bangladesh. All 56 schedule banks in Bangladesh are required to adopt the green financing policies as part of the effort to promote environmentally friendly practices in their banking operations. The majority of these banks showed eagerness to set up their own green banking guidelines and green unit on time, although the seriousness to implement all the sections of the policy vary, indicating further motivation is needed to ensure actual implementation by all banks. Being a commercial entity motivated by profit, it would be interesting to investigate the relationship between green financing and profitability of the commercial banks. This paper aims to investigate the relation between profitability and green financing based on the experience of 30 sample banks in Bangladesh. Several profitability ratios, namely ROE, ROA, AU and ROD have been used to find the relation with green financing utilized funds for three years 2012, 2013 and 2014. The study finds that there are significant relationships among different banks of Bangladesh such as conventional commercial banks, Islamic commercial banks, state-owned commercial banks and foreign commercial banks in terms of profitability ratios. In particular, the ROA, ROD and AU have significant positive relationships with green financing of the banks, while the ROE showed no significant relationship with green financing of the banks. IIUM Press 2016 Article PeerReviewed application/pdf en http://irep.iium.edu.my/55542/1/012%20Al-Shajarah%20Taslima.pdf application/pdf en http://irep.iium.edu.my/55542/2/55542_Green%20financing_WOS.pdf application/pdf en http://irep.iium.edu.my/55542/9/55542_Green%20financing%20and%20bank%20profitability_scopus.pdf Julia, Taslima and Kassim, Salina (2016) Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh. Al-Shajarah, 21 (3 ( Special Issue )). pp. 307-330. ISSN 1394-6870
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English English English
topic	H Social Sciences (General) HG Finance HG1501 Banking
spellingShingle	H Social Sciences (General) HG Finance HG1501 Banking Julia, Taslima Kassim, Salina Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh
description	Green financing is a relatively new phenomenon in Bangladesh’s banking sector following its introduction in 2011 by the Central Bank of Bangladesh. All 56 schedule banks in Bangladesh are required to adopt the green financing policies as part of the effort to promote environmentally friendly practices in their banking operations. The majority of these banks showed eagerness to set up their own green banking guidelines and green unit on time, although the seriousness to implement all the sections of the policy vary, indicating further motivation is needed to ensure actual implementation by all banks. Being a commercial entity motivated by profit, it would be interesting to investigate the relationship between green financing and profitability of the commercial banks. This paper aims to investigate the relation between profitability and green financing based on the experience of 30 sample banks in Bangladesh. Several profitability ratios, namely ROE, ROA, AU and ROD have been used to find the relation with green financing utilized funds for three years 2012, 2013 and 2014. The study finds that there are significant relationships among different banks of Bangladesh such as conventional commercial banks, Islamic commercial banks, state-owned commercial banks and foreign commercial banks in terms of profitability ratios. In particular, the ROA, ROD and AU have significant positive relationships with green financing of the banks, while the ROE showed no significant relationship with green financing of the banks.
format	Article
author	Julia, Taslima Kassim, Salina
author_facet	Julia, Taslima Kassim, Salina
author_sort	Julia, Taslima
title	Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh
title_short	Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh
title_full	Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh
title_fullStr	Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh
title_full_unstemmed	Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh
title_sort	green financing and bank profitability: empirical evidence from the banking sector in bangladesh
publisher	IIUM Press
publishDate	2016
url	http://irep.iium.edu.my/55542/ http://irep.iium.edu.my/55542/1/012%20Al-Shajarah%20Taslima.pdf http://irep.iium.edu.my/55542/2/55542_Green%20financing_WOS.pdf http://irep.iium.edu.my/55542/9/55542_Green%20financing%20and%20bank%20profitability_scopus.pdf
first_indexed	2023-09-18T21:18:30Z
last_indexed	2023-09-18T21:18:30Z
_version_	1777411723800608768

Green financing and bank profitability: empirical evidence from the banking sector in Bangladesh

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