Bank Survival in European Emerging Markets

Evžen Kočenda and Ichiro Iwasaki

No 675, Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: We analyze bank survival on large dataset covering 17 European emerging markets during the period of 2007-2015 by estimating the Cox proportional hazards model. We group banks across countries and according to their financial soundness. Our results show that progress in banking reforms positively affects bank survival. The economic impact of various determinants is largest for average banks measured by their soundness. Financial indicators predict bank survival rate with intuitively expected impact that is economically less significant in comparison to other factors. Specifically, ownership structure and legal form are the key economically significant factors that exhibit strongest economic effect on bank survival. We further document importance of banks being listed with respect to their survival. We also show that probability of exit increases after number of directors increases beyond a threshold. The results are robust no matter how bank are grouped, with respect to alternative specifications as well as alternative assumptions on survival distribution.

Keywords: Bank survival; Banking reform; European emerging markets; Survival and exit determinants; Hazards model (search for similar items in EconPapers)
JEL-codes: C14 D02 D22 G33 (search for similar items in EconPapers)
Pages: 20 pages
Date: 2018-08
New Economics Papers: this item is included in nep-ban
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://hermes-ir.lib.hit-u.ac.jp/hermes/ir/re/29438/DP675.pdf

Related works:
Journal Article: Bank survival in Central and Eastern Europe (2020)
Working Paper: Bank Survival in Central and Eastern Europe (2020)
Working Paper: Bank Survival in Central and Eastern Europe (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:hit:hituec:675

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