The Impact of Green Credit on the Net Interest Margin of Commercial Banks: A Comparative Analysis Before and After the Implementation of the Carbon Emission Reduction Support Instrument
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Keywords
green credit, net interest margin, carbon emission reduction support instrument, policy incentive effect
Abstract
Whether green credit leads commercial banks to “concede profits” or achieve “mutual benefits” remains inconclusive in the academic literature. Based on panel data from sample commercial banks over the period 2019–2024, this paper first examines the baseline effect of the proportion of green credit on net interest margin and then conducts grouped regressions before and after the implementation of the Carbon Emission Reduction Support Instrument to investigate its policy incentive effect. The empirical results show that the proportion of green credit exerts a positive effect on the net interest margin of commercial banks, confirming the “mutual-benefit” nature of green credit. Moreover, the implementation of the Carbon Emission Reduction Support Instrument strengthens this positive effect. The policy dividend is mainly captured by banks with asset sizes below the median, whereas banks with asset sizes above the median do not benefit significantly. This study deepens the understanding of the profitability mechanism of green credit and provides an empirical reference for the expansion decision of the Carbon Emission Reduction Support Instrument in 2026.
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