Macro-financial determinants of the great financial crisis: Implications for financial regulation

Gerard Caprio, D’Apice, Vincenzo, Giovanni Ferri and Giovanni Puopolo

Journal of Banking & Finance, 2014, vol. 44, issue C, 114-129

Abstract: We provide a cross-country and cross-bank analysis of the financial determinants of the Great Financial Crisis using data on 83 countries from the period 1998 to 2006. First, our cross-country results show that the probability of suffering the crisis in 2008 was larger for countries having higher levels of credit deposit ratio whereas it was lower for countries characterized by higher levels of: (i) net interest margin, (ii) concentration in the banking sector, (iii) restrictions to bank activities, (iv) private monitoring. The bank-level analysis reinforces these results and shows that the latter factors are also key determinants across banks, thus explaining the probability of bank crisis. Our findings contribute to extend the analytical toolkit available for macro and micro-prudential regulation.

Keywords: Banking crisis; Government intervention; Regulation (search for similar items in EconPapers)
JEL-codes: G01 G15 G18 G21 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (34)

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Related works:
Working Paper: Macro Financial Determinants of the Great Financial Crisis: Implications for Financial Regulation (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:44:y:2014:i:c:p:114-129

DOI: 10.1016/j.jbankfin.2014.03.001

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