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Empirical Analysis of the Impact of Climate Change Transition Risk on Bank Profitability

Bokyung Kim & Young‐Kyu Moh

Korea and the World Economy2025https://doi.org/10.46665/kwe.2025.04.26.1.1article
ABDC C
Weight
0.50

What the paper says

This paper analyzes the impact of Climate Change Transition Risk (CCTR) on the profitability of banks in South Korea. Employing quarterly panel data from banks from 2008 to 2020, we apply a fixed-effects model to examine the relationship between CCTR and Return on Assets (ROA). Empirical results show that CCTR has a negative effect on ROA, while the Climate Change Performance Index (CCPI) positively affects bank profitability. The interaction between loan size and CCPI indicates that greater credit exposure mitigates the positive effect of CCPI on ROA. However, policy changes associated with the Paris Agreement do not show a measurable impact on banks’ short-term performance.

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https://doi.org/https://doi.org/10.46665/kwe.2025.04.26.1.1

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@article{bokyung2025,
  title        = {{Empirical Analysis of the Impact of Climate Change Transition Risk on Bank Profitability}},
  author       = {Bokyung Kim & Young‐Kyu Moh},
  journal      = {Korea and the World Economy},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.46665/kwe.2025.04.26.1.1},
}

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Empirical Analysis of the Impact of Climate Change Transition Risk on Bank Profitability

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.