Abstract
In this paper, based on quarterly data on the financial statements of Russian banks for the period from mid‐2013 to the end of 2021, using econometric methods of analysis, we estimated the factors that affect both the probability of bank default as well as other indicators of its activity — risk and profitability. The results obtained showed that balance sheet ratios are significantly correlated with the probability of bank default, its risk of insolvency, and profitability. Asset quality, a bank’s size, a capital ratio, and liquidity creation are important determinants of these bank’s characteristics. The insolvency risk (measured as a Z‐score), in turn, is significantly negatively correlated with the probability of default and profitability (ROA).
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