Links
Next content
Read more
The effects of SSM adoption on bank’s profitability : a long-term effects difference-in-difference analysis
This paper analyses the impact of the introduction of the Single Supervisory Mechanism on the profitability of banks. While this topic has not been extensively covered in the literature, it is worthy of attention...
This paper investigates the impact of the firms’ environmental performance on their credit rating. To this end, we conduct a transatlantic study covering companies in the United States (US) and in the European Union (EU). Our study reveals that firms’ environmental improvements positively contribute to their credit ratings. However, this effect varies between the US and the EU. If US and European firms enhance their environmental performance by the same scale, the former’s creditworthiness benefits more than the latter’s. Additionally, we show that improvements in environmental performance affect credit ratings linearly in the US but nonlinearly in the EU. These findings shed light on the implications of the firms’ environmental performance and provide critical insights into the impact of corporate sustainability indicators on credit ratings.
This paper is part of the Banking Supervision Policy Working Paper Series in the context of the SSM-EUI partnership on SSM Banking Supervision Learning Services.