What is the cumulative default rate for green banks in the last decade?

The cumulative default rate for green banks in the last decade is indeed under 0.5%. This figure highlights the strong performance of green banks in managing loan portfolios related to sustainable projects compared to traditional financial institutions. Green banks focus on financing renewable energy and energy efficiency projects, which tend to have lower risks.

The lower default rates can be attributed to various factors, including rigorous project vetting processes, the growing demand for clean energy solutions, and supportive government policies. These elements contribute to the financial stability of borrowers in the green sector, making it less likely for defaults to occur.

In contrast, higher default rates indicated in other options would imply a less stable lending environment within green banking, which is not supported by the trends observed over the past decade. This information provides insight into the reliability and effectiveness of green banks in promoting sustainable initiatives while maintaining sound financial practices.