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Bank Acquisitiveness and Financial Crisis Vulnerability

Author

Listed:
  • Saqib Aziz

    (ESC Rennes School of Business - ESC [Rennes] - ESC Rennes School of Business, CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)

  • Michael Dowling

    (ESC Rennes School of Business - ESC [Rennes] - ESC Rennes School of Business)

  • Jean-Jacques Lilti

    (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique)

Abstract

We investigate the relation between European bank acquisitiveness during the period 1990-2006 and the vulnerability of banks to the financial crisis. Our main tests use distance to default and Z-score ratios to estimate banks impact from the financial crisis in terms of bankruptcy risk and solvency. The findings shed new light on whether bank acquisitions really did contribute towards weakness; and suggest that only acquisitions of investment banking assets increased risk, while acquisition of retail banking assets actually lowered solvency risk.

Suggested Citation

  • Saqib Aziz & Michael Dowling & Jean-Jacques Lilti, 2016. "Bank Acquisitiveness and Financial Crisis Vulnerability," Post-Print halshs-01360952, HAL.
    • Handle: RePEc:hal:journl:halshs-01360952
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01360952
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