 Predicting European banks distress events: Do financial information producers matter?Quentin Bro de Comères International Review of Financial Analysis, 2025, vol. 105, issue C Abstract: This article assesses the predictive power of sell-side stock analysts and credit rating agencies on listed European banks distress events by introducing their respective disclosures into a logit early-warning system over the 2000Q3-2020Q1 period. As direct bank failures are rare in Europe, I also account for state and private sector interventions. The model is calibrated to minimize the loss of a decision-maker committed to prevent impending distress events and is estimated in a real-time fashion. I also control for bank- and macroeconomic-level data by integrating accounting ratios and variables related to the banking sector and the business cycle as a whole. I find both financial information producers’ disclosures to display forward-looking informative and predictive performance on bank distress risk up to two years in advance. This highlights their added value on bank distress prediction with regard to accounting and macroeconomic data, that is beyond solely acting as a synthesis of such data. Keywords: Bank distress; Early warning systems; Financial analysts; Credit rating agencies (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:105:y:2025:i:c:s1057521925005046 DOI: 10.1016/j.irfa.2025.104417 Access Statistics for this article International Review of Financial Analysis is currently edited by B.M. Lucey More articles in International Review of Financial Analysis from Elsevier |
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