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Verifying the validity of Altman’s Z” Score as a predictor of bank failures in the case of the Eurozone

Chieng, Jasmine (2013) Verifying the validity of Altman’s Z” Score as a predictor of bank failures in the case of the Eurozone. Masters thesis, Dublin, National College of Ireland.

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Abstract

In light of recent events that have taken place in the Eurozone, the importance of knowing the financial position of banks is imperative to stakeholders. There is a major dearth of literature that examines the applicability of Altman’s Z” Score model to forecasting banking failures. The focus of this study is to confirm the validity of Altman’s Z” Score model as a predictor of Eurozone bank failures. This requires two data sets: failed and non-failed banks. Four distressed banks were benchmarked to four comparable control banks. Ratio analysis was carried out on the failed bank’s financial statements for five years prior to their bankruptcy or nationalisation as the Z” Score model has predictive power of up to five years pre-bankruptcy. The empirical findings verified the predictive ability of the Z” Score model to the euro area banks.

Item Type: Thesis (Masters)
Subjects: H Social Sciences > HG Finance > Banking
H Social Sciences > HC Economic History and Conditions > Economic Recession
H Social Sciences > HG Finance > Money > Currency > Euro (Single European Currency)
Divisions: School of Business > Masters of Science in Management
Depositing User: CAOIMHE NI MHAICIN
Date Deposited: 22 Nov 2013 16:13
Last Modified: 22 Nov 2013 16:13
URI: http://trap.ncirl.ie/id/eprint/865

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