Abstract
We explore the observable characteristics of sustainable banks, using a hand-collected dataset comprising of all public US bank holding companies, for the period 1999-2011. Our results indicate that sustainable banks are characterized by superior performance, more prudent behavior and a business model oriented towards financing industry and commerce. Specifically, they exhibit higher ROE and ROA, and have a higher market-to-book ratio which cannot be entirely accounted for by the higher ROE. They also have lower ratios of risk-weighted assets to total assets and finance more of their loans with deposits. Lastly, they have higher ratios of commercial and industrial loans to total loans. Overall, our results are consistent with the view that sustainable banks actively try to improve the risk-return profile of their whole operations, taking advantage of the benefits sustainability confers.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
