A Hazard Rate Analysis of Russian Commercial Banks in the Period 1994-1997

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Abstract

The number of commercial banks in russia increased at a fast pace after the 1988 banking reform. Many of these banks lacked supervision and operated with dangerously low funding capital. After the 1995 liquidity crisis, many of these banks disappeared. In this paper, we investigate the determinants of the hazard rates of banks active on the moscovian deposits market during the 1994–1997 period. We find that market share and duration have negatively affected the hazard rate, while the deposit interest rate has had a positive effect. The market share and interest rate effects are robust to controlling for ‘financial clans’.
Original languageEnglish
Pages (from-to)255-269
JournalEconomic Systems Research
Volume27
DOIs
Publication statusPublished - 1 Jan 2003

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