Financial earthquakes and aftershocks: From Brexit to Russia-Ukraine conflict and the stability of European banks

Phuong Thi Thu Vu; Nhan Huynh; Hoa Phan; Hanh Hoang

doi:10.1016/j.intfin.2023.101830

Financial earthquakes and aftershocks: From Brexit to Russia-Ukraine conflict and the stability of European banks

Phuong Thi Thu Vu, Nhan Huynh, Hoa Phan, Hanh Hoang

Department of Applied Finance

Research output: Contribution to journal › Article › peer-review

6 Citations (Scopus)

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Abstract

This study examines the impacts of recent turbulent events (Brexit, COVID-19 pandemic, and the Russia – Ukraine conflict) on the European banks’ resilience. Using the quarterly data of 251 commercial banks in 33 European economies from 2014 to 2022, we find that uncertainties significantly reduce bank's overall performance and stability. The comparisons of each event reveal the differential impacts in nature on specific indicators of performance and stability. The additional analyses highlight the roles of bank size, age, holding capital, and business models in attenuating the destabilizing effects of those shocks. The disparity effects are also visible across affiliations to income-generation levels and the European Union. The results are robust across alternative performance proxies and econometric approaches. From the starting point of this study, valuable implications are proposed for stakeholders, regulators, and policymakers in the challenges of unprecedented uncertainties.

Original language	English
Article number	101830
Pages (from-to)	1-22
Number of pages	22
Journal	Journal of International Financial Markets, Institutions and Money
Volume	88
DOIs	https://doi.org/10.1016/j.intfin.2023.101830
Publication status	Published - Oct 2023

Bibliographical note

© 2023 The Author(s). Published by Elsevier B.V. Version archived for private and non-commercial use with the permission of the author/s and according to publisher conditions. For further rights please contact the publisher.

Keywords

Bank stability
Economic policy uncertainty
European banks
Geopolitical risk
Health crisis

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title = "Financial earthquakes and aftershocks: From Brexit to Russia-Ukraine conflict and the stability of European banks",

abstract = "This study examines the impacts of recent turbulent events (Brexit, COVID-19 pandemic, and the Russia – Ukraine conflict) on the European banks{\textquoteright} resilience. Using the quarterly data of 251 commercial banks in 33 European economies from 2014 to 2022, we find that uncertainties significantly reduce bank's overall performance and stability. The comparisons of each event reveal the differential impacts in nature on specific indicators of performance and stability. The additional analyses highlight the roles of bank size, age, holding capital, and business models in attenuating the destabilizing effects of those shocks. The disparity effects are also visible across affiliations to income-generation levels and the European Union. The results are robust across alternative performance proxies and econometric approaches. From the starting point of this study, valuable implications are proposed for stakeholders, regulators, and policymakers in the challenges of unprecedented uncertainties.",

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AU - Hoang, Hanh

N1 - © 2023 The Author(s). Published by Elsevier B.V. Version archived for private and non-commercial use with the permission of the author/s and according to publisher conditions. For further rights please contact the publisher.

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Financial earthquakes and aftershocks: From Brexit to Russia-Ukraine conflict and the stability of European banks

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