Bank Distress in the European Union 2008-2015: A Closer Look at Capital, Size, and Revenue Diversification

Posted: 25 Jan 2019

See all articles by Stelios Markoulis

Stelios Markoulis

University of Cyprus - Department of Public and Business Administration; Frederick University; Cyprus International Institute of Management (CIIM)

Spiros Martzoukos

University of Cyprus - Department of Public and Business Administration; George Washington University - School of Business

Panayiotis Ioannou

Independent

Date Written: January 21, 2019

Abstract

The recent financial crisis has clearly highlighted the importance of the timely identification of weak banks. This paper introduces and analyses a unique sample of EU banks, which faced distress during 2008-2015 and provides evidence regarding the relationship between distress and bank-specific and macroeconomic variables, paying particular attention to capital, size, and revenue diversification. Findings regarding these variables seem to connect well with current supervisory actions. The paper also focuses on banks in EU countries that faced economic problems and documents that the probability of distress in these countries has been influenced by different factors, in comparison to the rest of the EU.

Keywords: Bank Distress, European Union Banks, Capital Ratios, Size, Revenue Diversification, GIIPS

JEL Classification: G01, G21, G33

Suggested Citation

Markoulis, Stelios and Martzoukos, Spiros Harilaos Spiridon and Ioannou, Panayiotis, Bank Distress in the European Union 2008-2015: A Closer Look at Capital, Size, and Revenue Diversification (January 21, 2019). Available at SSRN: https://ssrn.com/abstract=3319919

Stelios Markoulis (Contact Author)

University of Cyprus - Department of Public and Business Administration ( email )

75 Kallipoleos Street
P.O. Box 20537
Nicosia CY-1678
CYPRUS

Frederick University ( email )

7, Y. Frederickou Str.
Pallouriotisa
Nicosia, 1036
Cyprus

Cyprus International Institute of Management (CIIM) ( email )

P.O Box 20378
Aglandjia
Nicosia, CY-2151
Cyprus

Spiros Harilaos Spiridon Martzoukos

University of Cyprus - Department of Public and Business Administration ( email )

75 Kallipoleos Street
P.O. Box 20537
Nicosia CY-1678
CYPRUS
357-2-892474 (Phone)
357-2-892460 (Fax)

George Washington University - School of Business

Washington, DC 20052
United States
202-994-5996 (Phone)
202-994-5014 (Fax)

Panayiotis Ioannou

Independent ( email )

No Address Available

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