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Resistance of commercial banks to the crisis caused by the COVID-19 pandemic: the case of Poland

Author

Listed:
  • Zbigniew Korzeb

    (Bialystok University of Technology, Poland)

  • Pawel Niedziolka

    (Warsaw School of Economics, Poland)

Abstract

Research background: The analysis allows to assess the impact of the industry structure of the credit portfolio on the resistance of commercial banks to the crisis resulting from the COVID-19 pandemic. It uses two independent methods to measure the impact of the pandemic on industry risk and the methodology allowing to prioritize industries in terms of potential negative effects of the crisis. Purpose of the article: The aim of the research is to assess the resilience of commercial banks operating in the Polish banking sector to the potential effects caused by the COVID-19 pandemic. The diagnostic features of 13 commercial banks were selected for its implementation. Methods: Two linear ordering methods were used, namely the Hellwig method and the TOPSIS method. The following were used as the criteria for parametric assessment of the resilience of commercial banks: capital adequacy, liquidity level, profitability of business activity, share in the portfolio of exposures with recognized impairment and the resilience of the bank's credit portfolio to the risk resulting from the exposure in economic sectors. These sectors were classified according to the level of risk associated with the effects of the crisis caused by the COVID-19 pandemic. Findings & Value added: The study allows to conclude that the largest banks conducting their operations in Poland are the most resistant ones to the consequences of the pandemic. At the same time, the banks most vulnerable due to the crisis were identified. The conclusions can be used, inter alia, in the process of managing the financial system stability risk and contribute to the discussion on the impact of the pandemic on the condition of commercial banks in emerging markets.

Suggested Citation

  • Zbigniew Korzeb & Pawel Niedziolka, 2020. "Resistance of commercial banks to the crisis caused by the COVID-19 pandemic: the case of Poland," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 15(2), pages 205-234, June.
    • Handle: RePEc:pes:ierequ:v:15:y:2020:i:2:p:205-234
    DOI: 10.24136/eq.2020.010
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    Cited by:

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    2. Deimantė Teresienė & Greta Keliuotytė-Staniulėnienė & Rasa Kanapickienė, 2021. "Sustainable Economic Growth Support through Credit Transmission Channel and Financial Stability: In the Context of the COVID-19 Pandemic," Sustainability, MDPI, vol. 13(5), pages 1-34, March.
    3. Galil, Koresh & Varon, Eva, 2024. "National culture and banks stock volatility," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 91(C).
    4. Dorota Mi³ek, 2022. "Disparities in the level of regional technical infrastructure development in Poland: multicriteria analysis," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 17(4), pages 1087-1113, December.
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    9. Michal Bernardelli & Zbigniew Korzeb & Pawel Niedziolka, 2021. "The banking sector as the absorber of the COVID-19 crisis’ economic consequences: perception of WSE investors," Oeconomia Copernicana, Institute of Economic Research, vol. 12(2), pages 335-374, June.
    10. Andriy Stavytskyy & Ganna Kharlamova & Olena Komendant & Jarosław Andrzejczak & Joanna Nakonieczny, 2021. "Methodology for Calculating the Energy Security Index of the State: Taking into Account Modern Megatrends," Energies, MDPI, vol. 14(12), pages 1-19, June.
    11. Dominika Gajdosikova & Katarina Valaskova & Tomas Kliestik & Veronika Machova, 2022. "COVID-19 Pandemic and Its Impact on Challenges in the Construction Sector: A Case Study of Slovak Enterprises," Mathematics, MDPI, vol. 10(17), pages 1-20, September.
    12. Gabriela Traila, 2023. "Developments and Perspectives Regarding the Impact of Digital Transformation on the Banking System in Romania," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(1), pages 1112-1122, August.
    13. Azyanee Luqman & Cheam Chai Li & Siti Sarah Mohamad, 2023. "Predicting Intention to Continue Using E-Tourism Technologies amidst Covid-19 Endemic: A PLS-SEM Approach," Information Management and Business Review, AMH International, vol. 15(4), pages 77-85.
    14. Emil Ślązak & Magdalena Skwarzec, 2022. "The effects of IFRS 9 valuation model on cost of risk in commercial banks – the impact of COVID-19," Bank i Kredyt, Narodowy Bank Polski, vol. 53(1), pages 47-78.
    15. Marcin Bogdański, 2021. "Employment Diversification as a Determinant of Economic Resilience and Sustainability in Provincial Cities," Sustainability, MDPI, vol. 13(9), pages 1-13, April.
    16. Joanna Landmesser, 2021. "The use of the dynamic time warping (DTW) method to describe the COVID-19 dynamics in Poland," Oeconomia Copernicana, Institute of Economic Research, vol. 12(3), pages 539-556, September.
    17. Michał Bernardelli & Zbigniew Korzeb & Paweł Niedziółka, 2022. "Does Fossil Fuel Financing Affect Banks’ ESG Ratings?," Energies, MDPI, vol. 15(4), pages 1-19, February.
    18. Pollák František & Vavrek Roman & Váchal Jan & Markovič Peter & Konečný Michal, 2021. "Analysis of Digital Customer Communities in terms of their interactions during the first wave of the COVID-19 pandemic," Management & Marketing, Sciendo, vol. 16(2), pages 134-151, June.
    19. Gamze Ozturk Danisman & Ender Demir, 2021. "The Effect of Pandemics on Domestic Credit: A Cross-country Analysis," Economics Bulletin, AccessEcon, vol. 41(2), pages 444-456.
    20. Loredana Mihalca & Lucia Ratiu & Gabriela Brendea & Daniel Metz & Mihaela Dragan & Florin Dobre, 2021. "Exhaustion while teleworking during COVID-19: a moderated-mediation model of role clarity, self-efficacy, and task interdependence," Oeconomia Copernicana, Institute of Economic Research, vol. 12(2), pages 269-306, June.
    21. Katarina Valaskova & Tomas Kliestik & Dominika Gajdosikova, 2021. "Distinctive determinants of financial indebtedness: evidence from Slovak and Czech enterprises," Equilibrium. Quarterly Journal of Economics and Economic Policy, Institute of Economic Research, vol. 16(3), pages 639-659, September.
    22. Lolea Iulian Cornel & Stamule Simona, 2021. "Trading using Hidden Markov Models during COVID-19 turbulences," Management & Marketing, Sciendo, vol. 16(4), pages 334-351, December.
    23. Andrej Privara, 2022. "Economic growth and labour market in the European Union: lessons from COVID-19," Oeconomia Copernicana, Institute of Economic Research, vol. 13(2), pages 355-377, June.

    More about this item

    Keywords

    banking sector; commercial banks; banking crises; COVID-19; multi-dimensional comparative analysis;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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