How do borrower ESG performance and risks matter to banks?
研究了两种ESG指标（基于披露的表现和基于事件的风险）如何影响银行贷款成本，发现高风险推高利差、好表现降低利差，且借贷双方的ESG匹配影响定价。
We examine how two distinct Environmental, social and governance (ESG) measures—disclosure-based ESG performance and event-driven ESG risks—affect the cost of bank loans. Using an international sample, we find that borrowers with higher ESG risks face significantly higher loan spreads, while stronger ESG performance is associated with lower spreads. The cost-saving effect of ESG performance depends on ESG risk but not vice versa. Our analysis suggests that these relationships operate through mitigating information asymmetry and signalling borrower quality. Furthermore, matching between lenders’ and borrowers’ ESG profiles moderates banks’ pricing strategies, particularly in the risk dimension: ESG-aligned borrower–lender pairs are more likely to form lending relationships and secure loans at lower spreads. These findings provide new evidence on the pricing of different ESG dimensions in the loan market and highlight the role of lender–borrower ESG compatibility in shaping credit terms.