Assessment of the Probability of Bank Failure

ABSTRACT OF THE BACHELOR WORK ON THE TOPIC: Assessment of the Probability of Bank Failure The graduation paper is devoted to the prediction of bankruptcy of credit organizations in Russia. Relevance of the topic is that there is no universal system for assessing the probability of bank failures in Russia. Morover, the bankruptcy legislation is constantly changing. All this leads to low efficiency of banks. Therefore, it is necessary to improve theoretical and practical aspects of bankruptcy prediction. The aim of work is to build the econometric model for forecasting the probability of bankruptcy of the credit institution, that is based on the identified significant factors. The practical results of the work are: 1) econometric model that allows to assess the financial stability of commercial banks, which included six financial indicators: net interest margin, the value of assets and liabilities, long-term liquidity ratios, return on assets, the profitability of lending operations. 2) recommendations for improving the financial stability of PJSC "Zapsibcombank", which were compiled on the basis of the results of the constructed model and additional calculations of financial ratios. The practical significance and versatility of the research is the possibility of using the constructed model of forecasting of bankruptcy by credit institutions and borrowers.