Predicting bank failure in a historical banking crisis

During the recent financial crisis some banks collapsed but others did not. Why do some banks fail during a crisis, while others get off without a scratch? New research by PhD candidate Philip Fliers of Rotterdam School of Management, Erasmus University (RSM), uses Dutch economic history to find out. Fliers suggests that factors like age, size, debt ratios, branch penetration and internationalisation were all crucial for determining whether or not banks survived the Dutch banking crisis of the 1920s, the country’s last big banking crisis before that of 2008. Fliers argues that this historical crisis holds potentially very important lessons for policymakers today.