THE IMPACT OF SUSTAINABLE DEVELOPMENT ON RISK MANAGEMENT IN THE NPL PORTFOLIO IN THE WESTERN BALKAN COUNTRIES

Tamara Đalić; Miljana Barjaktarović; Vladan Cogoljević

doi:10.59864/Oditor32307D

Authors

Tamara Đalić College of Business Economics and Entrepreneurship, Belgrade, Serbia Author
Miljana Barjaktarović College of Business Economics and Entrepreneurship, Belgrade, Serbia Author
Vladan Cogoljević College of Business Economics and Entrepreneurship, Belgrade, Serbia Author

DOI:

https://doi.org/10.59864/Oditor32307D

Keywords:

green finance, green loans, sustainable banking, social responsibility, renewable energy, poverty reduction

Abstract

The concept of sustainable banking is based on the principle of achieving growth and profits for the bank and shareholders, but only by also achieving social goals and caring for environmental preservation. Providing new banking services and creating new (green) banking businesses that not only generate profits but also broader social and environmental objectives present opportunities for creating a competitive advantage, both in the Western Balkan countries observed in this study and in all countries worldwide. In this study, we will focus on analyzing macroeconomic parameters in the Western Balkan countries to examine the impact of selected indicators on the performance of the banking system, with a particular emphasis on the social and environmental protection components. The results indicate that the unemployment rate is the most significant indicator of potentially risky events for bankers, and banks are not recognized in the current environmental preservation strategies in the Western Balkan countries. Therefore, it is necessary to educate the population first and simultaneously promote green loans as sustainable and more favorable in the long term than traditional loans, while updating the existing regulatory framework in the field of environmental protection.

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