<p>This paper examines the threshold effect of financial development on the relationship between green innovation and financial stability. The results show that green innovation tends to have a significantly positive effect on long-term stability indicators (such as the bank Z-score and equity ratio). This impact is especially noticeable in less developed financial systems. In contrast, operational metrics like ROA volatility and non-performing loans are affected by a wider range of external factors, making the immediate influence of green innovation on these measures is less significant. These results offer policy-relevant insights into how promoting green innovation can support financial stability, especially within bank-based financial systems.</p>