| The Economic and Financial crisis of 2007/2008 led to a wide spread domino effect that destabilized the banking systems in the European Union countries. This case study documents the transmission and the influence of macroeconomic shocks on the stability of the EU banking systems and especially the German banking system. We use banking indices in order to identify various shocks and the periods in which they were incurred. Moreover we decompose our sample into two sub-samples, the poor south countries and the rich north countries. So in this case study, as mentioned, we focus on the German banking index and apply the difference-in-difference approach. What would be for example the reaction of this banking index during the entry period of Greece in the European Stability Mechanism (ESM) and the International Monetary Fund (IMF) and with what results? With the aforementioned difference-in-difference approach we try to identify the consequences, the transmission probability and the transmission channels of shocks in the German banking index. |
Updated 07/09/2013