Fall of dwarfs: micro and macroeconomic determinants of the disappearance of European small banks

Federica Poli, Simone Rossi and Mariarosa Borroni

Journal of International Financial Markets, Institutions and Money, 2024, vol. 96, issue C

Abstract: Based on a wide sample of banks headquartered in 27 European countries over the period 2005–2022, this paper tests the influence that microeconomic and macroeconomic variables have on the probability of small banks exiting the market, evaluating the predictive power of the explanatory models employed. Our approach to the determinants of small banks’ exit proves that even the macroeconomic and socio-demographic reference context can have a predictive effectiveness similar to that of the accounting variables, especially when contagion effects at the local level are taken into account.

JEL-codes: G17 G21 G28 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:intfin:v:96:y:2024:i:c:s1042443124001082

DOI: 10.1016/j.intfin.2024.102042

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