Sohel, Md Nurul Islam, Iqbal, Abdullah, Ahmed, Rizwan, Pappas, Vasileios (2026) Do banks price ESG performance? Regional evidence from Europe and the United States. European Financial Management, . ISSN 1354-7798. E-ISSN 1468-036X. (doi:10.1111/eufm.70078) (KAR id:114691)
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| Official URL: https://doi.org/10.1111/eufm.70078 |
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Abstract
This study examines whether corporate ESG performance affects syndicated loan spreads and whether the effect differs between Europe and the United States. Using LPC DealScan loans matched with Refinitiv ESG ratings for 2010–2023, we find that higher ESG scores are associated with lower loan spreads; a one-standard-deviation increase implies a 10.64-basis-point reduction. Environmental and social pillars drive the effect more strongly than governance. The negative ESG–spread relation is stronger in Europe and intensifies after the 2015 Paris Agreement, highlighting the roles of risk mitigation and institutional context in bank loan pricing.
| Item Type: | Article |
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| DOI/Identification number: | 10.1111/eufm.70078 |
| Uncontrolled keywords: | ESG performance; syndicated loan; corporate loan pricing; risk mitigation; and institutional theory |
| Subjects: | H Social Sciences > HG Finance |
| Institutional Unit: | Schools > Kent Business School |
| Former Institutional Unit: |
There are no former institutional units.
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| Funders: | University of Kent (https://ror.org/00xkeyj56) |
| Depositing User: | Abdullah Iqbal |
| Date Deposited: | 11 May 2026 10:57 UTC |
| Last Modified: | 03 Jun 2026 08:26 UTC |
| Resource URI: | https://kar.kent.ac.uk/id/eprint/114691 (The current URI for this page, for reference purposes) |
University of Kent Author Information
Sohel, Md Nurul Islam.
| Creator's ORCID: |
 https://orcid.org/0000-0001-6049-5285
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| CReDIT Contributor Roles: |
Iqbal, Abdullah.
| Creator's ORCID: |
https://orcid.org/0000-0002-3013-1007
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| CReDIT Contributor Roles: |
Ahmed, Rizwan.
| Creator's ORCID: |
https://orcid.org/0000-0002-1457-4115
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| CReDIT Contributor Roles: |
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