Iliana G. Chatzi, Mihail N.Diakomihalis and Evangelos Τ. Chytis

Correspondence: Mihail N.Diakomihalis, diakom@teiep.gr

Department of Accounting and Finance, Technological Educational Institute of Epirus, Greece

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Abstract

This study provides an in depth comparative analysis among Greek Commercial Bank institutions listed in Athens Stock Exchange Market, during time period from 2006 to 2012. The analysis is based on CAMEL methodology. The period 2007 to 2009 is characterized by high profitability, liquidity and high capital adequacy. However, the eruption of the economic crisis in Greece during 2009 and its ominous impacts is revealed on the bank financial statements and reports. The results derived from the CAMELS evaluation have been cross-tested using the Fixed Effects Model in a panel data analysis, which verify that before crisis the traditional ratios of are statistically significant, while the Sensitivity and Liquidity variables appeared to be the only rating components that provide insights into the banks financial situation during the crisis period. We conclude that changes in the economic environment and the emergence of new risks should be considered from both, bank managers and regulators, by the implementation and evaluation of Banks’ rating system.

Keywords:

  Camels, Economic crisis, Greece, Banking sector, Efficiency analysis

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