Impact of corporate governance factors on financial distress in the European banking industry

  • Dennis Kilian (Student)

Student thesis: Master's Thesis


This dissertation delves into the dynamics of financial distress within the European banking sector, covering the period from 2007 to 2021. Utilizing a binary random effects logistic regression model, the study investigates the interplay of internal corporate governance, financial ratios, regulatory policies, and economic factors in shaping the stability of publicly listed banks. The study uncovers that governance mechanisms and their impact on financial distress vary significantly across different economic periods. Notably, factors like board size, CEO-Chairman duality, and ownership concentration have diverse effects during economic crises. The empirical results reveal an intriguing relationship between increased capital adequacy and heightened financial distress, suggesting complexities in regulatory frameworks. The findings highlight the importance of adaptable and dynamic governance and regulatory compliance in managing financial distress. This thesis contributes to the understanding of banking governance and stability, offering insights for policymakers, bank managers, and academics in formulating responsive strategies to mitigate financial distress and enhance stability in the European banking sector.
Date of Award26 Jan 2024
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorRicardo Reis (Supervisor)


  • Financial distress
  • European banking
  • Corporate governance
  • CAMEL ratios
  • Regulatory policies
  • Global financial crisis
  • COVID-19 pandemic
  • Logistic regression


  • Mestrado em Finanças

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