Ranking of EU National Banking Systems Using Multi-Criteria Analysis in the Light of Brexit

Magdalena Radulescu (), Aleksandra Fedajev () and Djordje Nikolic ()
Additional contact information
Magdalena Radulescu: Faculty of Economic Studies, University of Pitesti, Romania
Aleksandra Fedajev: Technical Faculty in Bor, University of Belgrade, Serbia
Djordje Nikolic: Technical Faculty in Bor, University of Belgrade, Serbia

Acta Oeconomica, 2017, vol. 67, issue 4, 473-509

Abstract: In order to define and implement the most effective measures to overcome the difficulties of the post-crisis period, the policy-makers of ECB must identify not just main weaknesses of each banking system, but their strong points also. This requires the application of multi-criteria analysis, considering that policy-makers need to take into account a number of different aspects that, on the whole, indicate the quality of the banking system. Our aim is a comparative analysis of European banking systems right after the Brexit moment and within the framework of the tight new Basel III regulations. In this paper, we have ranked the banking systems of the 28 EU member states using multi-criteria analysis, specifically the PROMETHEE II method. The use of the PROMETHEE II method in combination with the entropy method offers a comprehensive insight into the banking system of each member state, given that the observed countries are ranked according to 9 conflicting criteria that are mostly used in banking system analysis. Our analysis shows that the banking systems in Central and Eastern Europe are the best performers, while the EMU’s developed banking systems such as the German, Italian, British, and French one are positioned among the last ranked. The Portuguese and Greek banking systems are, as expected, ranked in the last positions in our list. The obtained results also pointed out that the ECB should change its approach to the management and further development of a European Banking Union.

Keywords: multi-criteria analysis; PROMETHEE method; entropy method; European Union; banking systems; Brexit; European banking crisis; European Central Bank; European Banking Union (search for similar items in EconPapers)
JEL-codes: C10 C82 G21 (search for similar items in EconPapers)
Date: 2017
Note: The author would like to thank Júlia Király, Judit Neményi and Dóra Piroska for their helpful comments on an earlier version of the paper.
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.akademiai.com/doi/pdf/10.1556/032.2017.67.4.1 (application/pdf)
subscription

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aka:aoecon:v:67:y:2017:i:4:p:473-509

Ordering information: This journal article can be ordered from
Akadémiai Kiadó Zrt., P. O. Box 245, H-1519 Budapest, Hungary
https://akjournals.com/

Access Statistics for this article

Acta Oeconomica is currently edited by Mihályi, Péter

More articles in Acta Oeconomica from Akadémiai Kiadó, Hungary
Bibliographic data for series maintained by Kriston, Orsolya ().