Altynay Assanova

Type of the article: Research Article

Abstract
Green lending growth can support bank resilience and is therefore relevant to Kazakhstan’s pathway to carbon neutrality by 2060. The study created a panel of banking years (2015–2024) and assessed the relationships between banks’ regulatory compliance, digitalization, borrowers’ ESG performance, and green loan volumes using multivariate models. The research provides short-term forecasts using compressed ARIMAX and policy scenarios. Moreover, 20 purposively selected semi-structured interviews (commercial bank executives, SME owners, customers, and policy experts) and a national survey of 850 adult bank customers / SME owners led by the author were added. Across preferred specifications, regulatory eligibility and borrower ESG are consistently positive: policy support is associated with KZT 7-9 billion more green credit per bank year, and each one-point increase in borrower ESG is associated with KZT 0.34-0.38 billion higher volumes. Digitalization is positive but model-sensitive, strengthening within-bank variation; larger banks extend more green credit, consistent with capacity advantages. The results are interpreted through three stability channels: improved screening/asset quality, portfolio tilt toward taxonomy-aligned exposures, and funding access without making solvency claims. Scenario paths suggest aggregate green lending could reach KZT 80-96 billion by 2027 under aligned policy-ESG-digital conditions; under weak support, it may stagnate near KZT 49-55 billion. Findings motivate the development of a binding taxonomy with standardized disclosures, a national ESG scorecard registry, and inclusive digital rails to enhance SME and rural uptake.

Type of the article: Research article

Abstract
In transition economies, banking sector integrity is a critical prerequisite for economic resilience against exogenous shocks. This study evaluates the direct and indirect transmission channels through which public digital governance and systemic crisis shocks relate to banking stability and financial inclusion across 22 transition economies. Utilizing structural equation modeling (SEM) and path analysis based on annual panel data from 2003 to 2024 – supplemented by latent factor analysis, Dumitrescu-Hurlin causality tests, and post-estimation Wald tests – we analyze structural macro-level associations. Empirical results show that the static factor association between digital governance and banking stability is positive but marginally significant (β = 4.102, p = 0.079). In short-run dynamic first-difference specifications, no statistically significant immediate responsiveness is observed (β = 0.027, p = 0.516). Concurrently, improved banking stability significantly co-moves with financial inclusion (β = 0.042, p = 0.008), driven primarily by non-performing loan suppression (λ = −3.684, p = 0.018) and corruption control (λ = 0.034, p = 0.006). Systemic crisis shocks persistently depress both banking stability (β = −0.130, p = 0.009) and citizen financial engagement (β = −0.027, p < 0.001). Post-estimation Wald tests confirm cross-regional slope homogeneity (χ2(1) = 0.48, p = 0.487 for governance-to-stability; χ2(1) = 0.03, p = 0.855 for stability-to-inclusion). Contrary to conventional assumptions, public digital governance does not act as an immediate countercyclical shock absorber, highlighting the necessity of pairing digital reforms with long-term structural policies.

Acknowledgments
Oleksii Zakharkin’s contribution to this article was prepared as part of a research project funded by the Ministry of Education and Science of Ukraine, titled “GovTech for Ukraine: A Digital, Secure, Transparent, and Equitable State in Times of War and Post-War Reconstruction” (registration number: 0126U000544).