Bank branch agglomeration and corporate green transformation: Evidence from China

•This paper evaluates the impact of bank branch agglomeration on corporate green transformation.•The mediation mechanism of bank branch agglomeration and green transformation via financing constraints, green investments, and green innovation.•The influence of bank branch agglomeration on green trans...

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Bibliographic Details
Published in:Finance research letters 2023-12, Vol.58, p.104478, Article 104478
Main Authors: Teng, Mingming, Tan, Weijie
Format: Article
Language:English
Subjects:
Bank branch agglomeration
Financing constraints
Green inoovation
Green transformation
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Summary:•This paper evaluates the impact of bank branch agglomeration on corporate green transformation.•The mediation mechanism of bank branch agglomeration and green transformation via financing constraints, green investments, and green innovation.•The influence of bank branch agglomeration on green transformation is heterogeneous. This paper examines the impact of bank branch agglomeration around Chinese A-share listed firms on their green transformation. The study finds that bank branch agglomeration around listed firms at 5 km, 10 km, and 20 km significantly contributes to green transformation. The result is still valid after robustness testing. According to the mechanism analysis, the agglomeration of bank branches near enterprises facilitates green transformation by reducing financing constraints, increasing green investments, or enhancing green innovation. These findings provide theoretical supplements and policy recommendations regarding the relationship between the development of regional banking institutions and the green transformation of enterprises.
ISSN:1544-6123
1544-6131
DOI:10.1016/j.frl.2023.104478