Carbon footprints of lending and bank performance: international evidence from panel data.

The paper studies the interaction between a set of bank performance indicators (concentration, profitability, and risk) and the carbon footprint of bank loans. Our research builds on the panel data analysis for 37 countries during 2010-2018, adopting local projections proposed by Jordá (Am Econ Rev 95(1):161-182, 2005), a feasible alternative to panel VAR estimation in case of short time series. In order to account for potentially different patterns in the relationship among the indicators, we split the whole panel into two sub-panels, using K-means clusterization based on income level, resource abundance, and overall environmental performance.