Abstract

This paper examined how the bank ESG affects the banks’ lending behavior during the Covid-19 Pandemic. We use a sample of the syndicated loan data, we found that the banks with ESG level are more likely to lend to the borrowing companies that are more profitable and creditworthy. The low ESG banks have higher probability to lend if the purpose of the loan facility is for acquisition and if the borrowing bank is more familiar. Our results suggest that the banks with high ESG are more welcome to the companies running in worse conditions when making lending decisions, therefore their behavior match their name of being socially responsible.