The impact of COVID-19 on the banking sector. Are we heading for the next banking crisis?

Kamila Tomczak

Qualitative Research in Financial Markets, 2023, vol. 17, issue 3, 493-510

Abstract: Purpose - This study aims to examine the effect of the COVID-19 pandemic on the banking sector and to assess if COVID-19 was a trigger for the banking crisis. Design/methodology/approach - To achieve the main objective, the beta of the banking sector was calculated and analysed. In addition, a fixed panel regression model was applied over the period from the 30th of December 2019 until the 24th of September 2021. Findings - The results suggest that the pandemic contributed to higher volatility and risk in banking sector but did not confirm a systematic banking crisis. Originality/value - This paper contributes to the literature by analysing the COVID-19 pandemic as a potential trigger for a banking crisis. This paper also contributed by studying the effects of COVID-19 on the banking sector, especially the risk in the banking sector.

Keywords: Banking sector; Capital asset pricing model beta; COVID-19 pandemic (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:eme:qrfmpp:qrfm-09-2021-0157

DOI: 10.1108/QRFM-09-2021-0157

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