All modern societies are increasingly operating on the basis of the existence of ethical banking. While traditional banking in times of global crisis is always the subject of questioning, it emerges the notion of ethical banking as a different concept of banking. In this paper we will deal with the term ethical banking and define and analyze changes taking place in the banking sector. Ethical banks at a time of turmoil in global markets have proven to be more efficient than traditional banks. Their primary goal is sustainable development and they are focused on financing projects related to increasing economic and social benefits. Ethical banking risks are that there is not yet a sufficiently extensive network of ethical banks and that commercial banks hold most markets. The establishment of an ethical bank that would be owned by its clients and would finance projects that are currently relevant in the Republic of Croatia has been under discussion in Croatia for some time now. Projects related to environmental protection and social development are in one way a priority of investing in Croatia, since we are the youngest member of the EU, which according to agreements with all other EU members, must make greater efforts to implement sustainable development projects.