Bank failure prediction: corporate governance and financial indicators
نویسندگان
چکیده
Abstract This paper reiterates the importance of corporate governance in banks. Failure prediction studies have mainly relied on using financial ratios as predictors. The most suitable predictors for banks are following CAMEL rating system. Also, has been proven to be an important aspect banks, especially after crisis. Given its importance, novelty this is test ability increase accuracy and extend time-horizon bank failure US market. Using discriminant analysis, we predict insured by Federal Deposit Insurance Corporation from 2010 2018. non-financial predictors, find that combining with variables not only increases but also extends time horizon three years before failure. We show earnings a more significant predictor than capital structure asset quality. results further reveal CEO compensation, voting rights institutional ownership These robust when logit regression out-of-sample examination. study shows plays key role success or regulatory implication attention needs directed aspects rather focusing structure.
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ژورنال
عنوان ژورنال: Review of Quantitative Finance and Accounting
سال: 2023
ISSN: ['1573-7179', '0924-865X']
DOI: https://doi.org/10.1007/s11156-023-01158-z