This article aims to introduce a new research topic by investigating the role of banking sector development on Turkey's CO2 emissions for the time period 1980-2014. Autoregressive Distributed Lag (ARDL), Fully Modified-OLS (FMOLS), and Canonical Co-integrating Regression (CCR) models are applied to test the coefficients between the variables. The newly-developed Bayer-Hanck combined cointegration test is used to support the robustness of the ARDL bounds test. The results show that banking sector development led to an increase in CO2 emissions. The improvements in the Turkish banking sector development could lead to increased investment and energy consumption, which would subsequently cause raise in CO2 emissions. Furthermore, the results show that an increase in the RIN would lead to decrease in CO2 emissions. RIN has fundamental repercussions for the economy by either impacting the cost of capital or influencing the availability of credit, which in turn determines the level of savings as well as that of investment in an economy, which may subsequently affect CO2 emissions. It is suggested that policy-makers should use the banking sector development and RIN channels to reduce environmental degradation by introducing monetary policy reforms, while also encouraging energy investment and the production of electricity using renewable sources.