Financial Failure Prediction in Banks: The Case of European Union Countries
Financial Failure Prediction in Banks: The Case of European Union Countries
Author(s): Zeynep TürkcanSubject(s): Supranational / Global Economy, Methodology and research technology, Financial Markets, Accounting - Business Administration
Published by: Orhan Sağçolak
Keywords: Financial Distress; EU; Financial Ratios; Macro-economic Indicators; Panel Logit Model;
Summary/Abstract: Financial crisis in 2007, affecting the whole world, revealed the significance of early prediction of distressed banks and companies, and subsequently research on financial distress prediction in the banking sector accelerated considerably. This study estimates the financial failure of banks and looks at the factors related to bank failure using a five-stage empirical model based on panel data for the 1990-2010 period, for banks operating in 27 European Union (EU) countries. Using a panel logit model to determine which of the independent variables led to the bank failure, it is observed that “Non-interest Income to Total Income” is the best predictor.
Journal: İşletme Araştırmaları Dergisi
- Issue Year: 10/2018
- Issue No: 2
- Page Range: 554-569
- Page Count: 16
- Language: English
