Determinants of Bank Stability: A Financial Statement Analysis of Turkish Banks

Danışman, Gamze Öztürk

doi:10.17233/sosyoekonomi.2018.04.06

Cited by 14 publications

(4 citation statements)

References 44 publications

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“…Using a binary probit model with several internal and external variables, the industrial production index was found to impact the NPL ratio with statistical significance. Danisman (2018) explored the determinants of bank stability using Turkish bank data from 2007-2015. The study employed GMM estimation techniques and found that return on assets, loans to asset ratio, inefficiency index, non-interest income share and loans loss provision share can all explain NPLs.…”

Section: Theme 2: Z-score Applications As a Bank Stability Measurementioning

confidence: 99%

Bank Stability and Systemic Risk Measurement

Tarkocin,

Donduran

2023

IJFBS

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The banking system’s role as an intermediary between depositors and borrowers makes its stability a crucial element of the economy. Individual bank stability impacts the stability of the financial sector and, consequently, the real sector and economic growth. This study is a detailed investigation of bank stability scores for the Turkish banking sector. Turkey experienced a major banking crisis from 2000 to 2001. However, with an improved regulatory environment and structural reforms, its resilience to shocks increased significantly in subsequent years. The present study contributes to the literature in three areas. First, it applies eight variations of the Z-score to the Turkish banking sector to test the importance of time and risk variation. Second, it investigates the impact on stability scores of several factors–the implementation of new capital regulations and Basel III liquidity rules, the Turkish lira crisis and the effects of COVID-19). Finally, it measures the contribution to systemic risk of each Turkish bank using the leave-one-out (LOO) Z-score method; this is the first study to use this method to analyse the contribution of different bank types to the overall stability of the sector.

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Section: Theme 2: Z-score Applications As a Bank Stability Measurementioning

confidence: 99%

Bank Stability and Systemic Risk Measurement

Tarkocin,

Donduran

2023

IJFBS

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“…Hardouvelis and Vaianos (2023) came to similar conclusions about the negative impact of the growth of non-performing assets on the performance of Greek banks. The emergence of problem loans in the corporate sector can be explained by the credit risk of Turkish banks, which leads to a decrease in return on assets (ROA), the share of non-interest income and an increase in the share of provisions for loan losses, Danishman (2018) believes. Akhryomushkin (2018), who has researched the problems of the bank corporate lending development in Kazakhstan, believes that big business in the country is almost entirely owned, firstly, by international corporations (oil and gas and mining), which receive direct financing from parent companies and do not need loans from local banks; or secondly, to the state, which attracts long money on international capital markets cheaper than their cost in domestic private banks, and can also redistribute raw excess in favor of larger public sector companies (Perminov, 2021).…”

Section: Literature Reviewmentioning

confidence: 99%

Development Management of Interbank Competition in the Corporate Lending Market

Kretov,

Mindova,

Aitaliev

et al. 2023

ees

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Introduction. The effective functioning of the banking sector is a prerequisite for the economy development and one of the main sources of providing monetary resources for economic activity of entrepreneurship, regardless of ownership forms and spheres of management. The urgent problem of business development today is the lack of own financial resources for economic activity and a significant reduction in corporate bank lending. Therefore, it is relevant to study and solve the problems of renewing lending by banks to the corporate sector at the present time, taking into account the prevention of the increase in the level of credit risk. Aim and tasks. The purpose of the study is to manage the development of interbank competition in the corporate lending market based on a study of the bank lending state to corporate clients and further prospects in the absence of an accurate forecast of the economic situation in Ukraine. Results. The analysis of the dynamics of the bank lending total volume to business in 2022-2023 and the structure of the provided corporate loans showed that since mid-2022 there has been a tendency to decrease the volume of loans to entrepreneurship, which is caused by a decrease in demand from borrowers and an increase in the cost of credit from banks. In addition, more than 70% of the loans provided are concentrated in five larger banks in Ukraine, including 4 state-owned ones, preferential lending to businesses with state support prevails. To further assess the development of corporate bank lending, a prediction of lending volumes for 2023 was carried out, which made it possible to establish that lending volumes by banks of non-financial corporations have a forecast downward trend. Conclusions. Recommendations for improving corporate bank lending processes are proposed, namely: development of credit policy directions that will prevent a new crisis of confidence in banks and the banking system; development of measures that will prevent the curtailment of preferential targeted lending programs; developing measures to reduce the level of non-performing loans and solving the problem of lowering the cost of financing sources.

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“…The results suggested that the inefficiency and asset size increase NPLs, whereas interest rate and growth rate of GDP and capital adequacy decrease NPLs. Danisman (2018) studied determinants of NPLs in Turkey and stated that profitability, capital adequacy and bank size affect adversely credit quality. Kjosevski, Petkovski and Naumovska (2019) focused on examining the effect of determinants of NPLs in North Macedonia.…”

Section: Literature Reviewmentioning

confidence: 99%

How Do Bank-Specific Factors Impact Non-Performing Loans: Evidence from G20 Countries

Erdaş

Ezanoğlu

2022

Journal of Central Banking Theory and Practice

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Banking is important for the stability and success of the economy. The success of the banking system on financial intermediation in developing countries is directly affected by non-performing loans (NPLs). Many factors can be treated as NPL determinants. Accordingly, the factors that explain NPLs contain very important information for banks. To this end, the study is an attempt to examine various banking factors that affect NPLs with respect to developing economies. In this study, the bank-specific and macroeconomic factors affecting the NPL rates were analysed through the dynamic panel data analysis. Analyses were made using described G20 countries between 1998 and 2017. The results indicate that the lagged value of NPLs, return on equity, credit growth and credit costs have a significant positive relationship with NPLs, while capital adequacy and GDP have a negative association with NPLs. The results confirm that if the bank-specific conditions change, the credit quality and bank management of banks are affected. It was concluded that the performance of banks is responsive to an effective loan monitoring policy. The findings of the study have implications for policymakers and regulators in the banking sector.

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Determinants of Bank Stability: A Financial Statement Analysis of Turkish Banks

Cited by 14 publications

References 44 publications

Bank Stability and Systemic Risk Measurement

Bank Stability and Systemic Risk Measurement

Development Management of Interbank Competition in the Corporate Lending Market

How Do Bank-Specific Factors Impact Non-Performing Loans: Evidence from G20 Countries

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