Perspectives by green financial instruments – a case study in the Hungarian banking sector during COVID-19
-
DOIhttp://dx.doi.org/10.21511/bbs.18(1).2023.10
-
Article InfoVolume 18 2023, Issue #1, pp. 116-126
- Cited by
- 903 Views
-
292 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
Recently, the management of the green financial sector has been widely influenced by global socio-economic concerns such as the COVID-19 pandemic and the energy crisis. The purpose of this paper is to evaluate, besides their environmental attitude, what opinions and experiences the affected stakeholders have about the sustainability-related processes in the Hungarian banking sector in the early 2020s. To assess this subject extensively, two questionnaire surveys were conducted in two consecutive years (2020/2021 and 2021/2022), involving 600 and 1,600 participants randomly chosen from banking databases, respectively. The results indicate that both residential and corporate participants have various but broadening knowledge of green financial instruments. Hungarian residential customers have pointed out the inconveniences of the most popular green loan product (Green Home Program), while there appears a distinct difference in green investment preferences between the two groups of respondents. Hungarian stakeholders are quite eco-conscious, and so are banks adopting sustainability and climate risk assessment actions, however, the implementations have much potential to exploit. Respondents also identify the energy crisis-related risks, while their trust in the banking system remains high even under volatile circumstances. These findings demonstrate that the Hungarian green banking sector has a high degree of crisis resistance with residential and corporate stakeholders behind giving trust and thereby the driving force toward the successful green transition.
- Keywords
-
JEL Classification (Paper profile tab)F65, G15, G21
-
References53
-
Tables0
-
Figures6
-
- Figure 1. Residential and corporate knowledge of green financial products
- Figure 2. The problems of GHP from the customers’ point of view as of June 2022
- Figure 3. Sectoral investment interest of residential (outer arc) and corporate (inner arc) respondents (June 2022)
- Figure 4. Eco-consciousness of residential and corporate respondents
- Figure 5. The activity of banks related to the establishment of a green transition plan with climate goals
- Figure 6. The activity of banks related to the establishment of sustainable credit risk plans at the end of 2021
-
- Bao, J., & He, M. (2022). Does green credit promote green sustainable development in regional economies? – Empirical evidence from 280 cities in China. PlosOne, 17(11), e0277569.
- Boiko, A., Umantsiv, Y., Cherlenjak, I., Prikhodko, V., & Shkuropadska, D. (2022). Policy measures for economic resilience of Visegrad Group and Ukraine during the pandemic. Problems and Perspectives in Management, 20(2), 71-83.
- Boros, A., & Huszár, B. E. (2021). Green financial products in the European banks’ portfolio – with a Hungarian perspective. Civic Review, 17, 141-152.
- Borowski, P. F. (2022). Mitigating climate change and the development of green energy versus a return to fossil fuels due to the energy crisis in 2022. Energies, 15(24), 9289.
- Cao, C., Tong, X., Chen, Y., & Zhang, Y. (2022). How top management’s environmental awareness affect corporate green competitive advantage: evidence from China. Kybernetes, 51(3), 1250-1279.
- CBH. (2019). Act CXXXIX of 2013 on the Magyar Nemzeti Bank. (In Hungarian).
- CBH. (2021). Zöld Pénzügyi Jelentés, Helyzetkép a magyar pénzügyi rendszer környezeti fenntarthatóságáról [Green Financial Report, Situation on the environmental sustainability of the Hungarian financial system]. (In Hungarian).
- CBH. (2022a). Zöld Pénzügyi Jelentés [Green Financial Report]. (In Hungarian).
- CBH. (2022b). Családi Zöld Pénzügyek [Family Green Finances]. (In Hungarian).
- CBH. (2022c). Tájékoztató a lakáscélú Zöld Tőkekövetelmény-kedvezmény Program módosított feltételeiről [Information on the modified conditions of the Green Capital Requirement Discount Program for residential purposes]. (In Hungarian).
- CBH. (2022d). Tájékoztató a zöld vállalati és önkormányzati tőkekövetelménykedvezmény kiegészítéséről [Information on the addition of the Green Corporate and Local Government Capital Requirement Discount Program]. (In Hungarian).
- CBH. (2022e). NHP Zöld Otthon Program. [FGS Green Home Program]. (In Hungarian).
- CBH. (2022f). Az MNB zöld jelzáloglevelek jövőbeni kibocsátását és a zöld jelzáloghitelek elterjedését támogatja a forint lejárati összhangra vonatkozó szabályozás módosításával [The CBH supports the future issuance of green mortgage bonds and the spread of green mortgage loans by amending the regulations on forint maturity harmonization]. (In Hungarian).
- Chen, J., Siddik, A. B., Zheng, G. W., Masukujjaman, M., & Bekhzod, S. (2022). The effect of green banking practices on banks’ environmental performance and green financing: An empirical study. Energies, 15(4), 1292.
- Chițimiea, A., Minciu, M., Manta, A. M., Ciocoiu, C. N., & Veith, C. (2021). The drivers of green investment: A bibliometric and systematic review. Sustainability, 13(6), 3507.
- Deák, V. (2021). The MNB’ Green Programme. Civic Review, 17, 153-163.
- Donthu, N., & Gustafsson, A. (2020). Effects of COVID-19 on business and research. Journal of Business Research, 117, 284-289.
- ECB. (2022). Az EKB éghajlattal kapcsolatos programja 2022-ben [The ECB’s climate agenda for 2022]. (In Hungarian).
- EEMI. (2022). The Energy Efficient Mortgages Initiative at a glance.
- Eurostat. (2008). NACE Rev. 2, Statistical classification of economic activities in the European Community.
- Ferreira, J., & Morais, F. (2022). Does the Coronavirus Crash affect green equity markets’ efficiency? A multifractal analysis. Journal of Sustainable Finance & Investment.
- Government Debt Management Agency Pte. Ltd. (AKK). (2021). Hungary Green Bond Allocation Report 2020.
- Herath, R. R., & Wanninayke, W. M. C. B. (2009). The attitudes of customers towards green investments. Journal of Management, 5(1), 22-30.
- HSCO. (2020). Magyarország, 2020. I–III. negyedév [Hungary, 2020. Q1-Q3].
- HSCO. (2021). Beruházások – A beruházások volumenváltozása anyagi-műszaki összetétel szerint [Changes in the volume of investments according to material and technical composition]. (In Hungarian).
- HSCO. (2022). A fenntartható fejlődés indikátorai Magyarországon, 2021 [Indicators of sustainable development in Hungary, 2021]. (In Hungarian).
- HVCA. (2022). Venture Capital and Private Equity update Hungary – Q1 2022.
- Ibe-enwo, G., Igbudu, N., Garantie, Z., & Popoola, T. (2019). Assessing the relevance of green banking practice on bank loyalty: The mediating effect of green image and bank trust. Sustainability, 11(17), 4651.
- Khan, S. A. R., Yu, Z., & Umar, M. (2021). How environmental awareness and corporate social responsibility practices benefit the enterprise? An empirical study in the context of emerging economy. Management of Environmental Quality, 32(5), 863-885.
- Kostenko, A., Kozyntseva, T., Opanasiuk, V., Kubatko, O., & Kupenko, O. (2022). Social resilience management of Ukrainian territorial communities during the Covid-19 pandemic. Problems and Perspectives in Management, 20(3), 1-11.
- Kuchinka, D. G. J., Balazs, S., Gavriletea, M. D., & Djokic, B. B. (2018). Consumer attitudes toward sustainable development and risk to brand loyalty. Sustainability, 10(4), 997.
- Kumar, B., Szepesi, G., Čonka, Z., Kolcun, M., Péter, Z., Berényi, L., & Szamosi, Z. (2021). Trendline assessment of solar energy potential in Hungary and current scenario of renewable energy in the Visegrád Countries for future sustainability. Sustainability, 13(10), 5462.
- Milicevic, N., Djokic, N., Mirovic, V., Djokic, I., & Kalas, B. (2023). Banking support for energy security: The customer aspect. Sustainability, 15(1), 112.
- Moon, Z. H., & Hasan, M. M. (2022). Impact of COVID-19 on green financial practices of banks and financial institutions in Bangladesh. Journal of Business and Social Sciences Research, 7(1), 21-40.
- Nachammai, S., & Manju, N. (2019). Problems faced by the customers regarding the borrowing of the loan in State Bank of India – An analysis. Journal of Emerging Technologies and Innovative Research, 6(11), 978-981.
- Naidoo, R., & Brendan, F. (2020). Reset sustainable development goals for a pandemic world. Nature, 583, 198-201.
- Ngo, T. Q., Doan, P. N., Vo, L. T., Tran, H. T. T., & Nguyen, D. N. (2021). The influence of green finance on economic growth: A COVID-19 pandemic effects on Vietnam Economy. Cogent Business & Management, 8(1), 2003008.
- OTP Bank. (2021). A hazai piacon elsőként zöld jelzáloglevelet hozott forgalomba az OTP Csoport [The OTP Group was the first to introduce green mortgage bonds on the domestic market]. (In Hungarian).
- Park, H., & Kim, J. D. (2020). Transition towards green banking: role of financial regulators and financial institutions. Asian Journal of Sustainability and Social Responsibility, 5, 5.
- Risal, N., & Joshi, S. K. (2018). Measuring green banking practices on bank’s environmental performance: Empirical evidence from Kathmandu valley. Journal of Business and Social Sciences, 2(1), 44-56.
- Ritter, R. (2022). Banking sector exposures to climate risks – Overview of transitional risks in the Hungarian corporate loan portfolio. Financial and Economic Review, 21(1), 32-55.
- Satheesh Kumar, C. (2017). A study on customers awareness on green banking initiatives in selected private sector banks with reference to Kunnamkulam Municipality. SSRG International Journal of Economics and Management Studies, 4(3), 40-42.
- Semieniuk, G., Campiglio, E., Mercure, J. F., Volz, U., & Edwards, N. R. (2020). Low-carbon transition risks for finance. WIREs Climate Change, 12(1), e678.
- Sharabati, A. A. A., Al-Haddad, S., Judeh, M., & Al-Badawi, B. (2022). Brand extension and purchase intention of Jordanian banks’ clients. Innovative Marketing, 18(2), 60-71.
- Shkarupa, O., Vlasenko, D., Vesperis, S., Treus, A., & Juhaszova, Z. (2021). Strategic management or sustainable decisions in business: A case of greening the transport companies. Problems and Perspectives in Management, 19(4), 311-324.
- Smit, S., Jánoskuti, L., Havas, A., Puskás, P., & Békés, M. (2020). Repülőrajt – A magyar gazdaság növekedési pályája 2030-ig [Take off – The growth trajectory of the Hungarian economy until 2030]. (In Hungarian).
- Szabo, J., Weiner, C., & Deák, A. (2021) Energy Governance in Hungary. In M. Knodt & J. Kemmerzell (Eds.), Handbook of Energy Governance in Europe (pp. 1-32). Cham: Springer.
- Tan, L. P., Sadiq, M., Aldeehani, T. M., Ehsanullah, S., Mutira, P., & Vu, H. M. (2022). How COVID-19 induced panic on stock price and green finance markets: global economic recovery nexus from volatility dynamics. Environmental Science and Pollution Research, 29(18), 26322-26335.
- Velenturf, A. P., & Purnell, P. (2021). Principles for a sustainable circular economy. Sustainable Production and Consumption, 27, 1437-1457.
- Versal, N., & Sholoiko, A. (2022). Green bonds of supranational financial institutions: On the road to sustainable development. Investment Management and Financial Innovations, 19(1), 91-105.
- Wang, H., Ma, B., & Bai, R. (2019). How does green product knowledge effectively promote purchase intention? Sustainability, 11(4), 1193.
- WHO. (2022). Hungary Situation.
- Widyawati, L. (2019). A systematic literature review of socially responsible investment and environmental social governance metrics. Business Strategy and the Environment, 29(2), 619-637.