IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

Determinants of the Banking Crises in the Turkish Economy

Listed author(s):
  • Cemil VARLIK

    (Gazi Üniversitesi)

Registered author(s):

    We constructed a monthly banking sector fragility index. According to this index, during the January 1987 – October 2004 period, the Turkish economy experienced three banking crises (in 1988, in 1994 and in 2001), two of which (in 1994 and in 2001) were twin crises. With risks at quite a high level, the banking sector was vulnerable to crises prior to all three events. A number of conclusions emerge from our probit estimations. Currency and banking crises are closely linked, and the twin crises have been the problem of the Turkish economy especially since 1990. The banking crises in Turkey in the aforementioned period were accompanied by sudden reversals in capital flows. A real depreciation of the Turkish Lira increases the likelihood of a banking crisis. An economic contraction reduces the value of the bank assets by making it difficult for the banks’ costumers to repay their credits, thus raising the likelihood of a banking crisis. The ratio of broad money to international reserves significantly affects the probability of a banking crisis, although this does not appear as a significant factor in the 2001 banking crisis.

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below under "Related research" whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Article provided by Bilgesel Yayincilik in its journal İktisat İşletme ve Finans.

    Volume (Year): 22 (2007)
    Issue (Month): 260 ()
    Pages: 120-146

    in new window

    Handle: RePEc:iif:iifjrn:v:22:y:2007:i:260:p:120-146
    Contact details of provider: Web page:

    No references listed on IDEAS
    You can help add them by filling out this form.

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:iif:iifjrn:v:22:y:2007:i:260:p:120-146. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ali Bilge)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.