Predictors of Bank Distress: The 1907 Crisis in Sweden
Research output: Working paper
Abstract
This paper contributes to literature on bank distress using the Swedish experience of the in- ternational crisis of 1907, often paralleled with 2008. By employing previously unanalyzed bank-level data, we use logit regressions and principal component analysis to measure the im- pact of pre-crisis bank characteristics on the probability of their subsequent distress. The crisis was characterized by “creative destruction,” as those banks with weaker corporate governance structures, wider branching networks, operating with lower cost efficiency were more likely to experience distress. We find that poor credit allocation rather than foreign borrowing, as often stressed, were associated with ultimate demise.
Details
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Research areas and keywords | Subject classification (UKÄ) – MANDATORY
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Original language | English |
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Number of pages | 55 |
Publication status | Published - 2018 |
Publication category | Research |
Publication series
Name | Lund Papers in Economic History. General Issues |
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Publisher | Department of Economic History, Lund University |
No. | 2018:180 |
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