Banks’ Earnings: An Empirical Evidence of the Influence of Economic and Financial Markets Factors

Abstract

Since the 1990s’, a relatively ample research has been undertaken regarding the measurement of the volatility of bank earnings over time. The comparison between traditional deposits-loans banking activities and financial activities is a further specific theme in bank performance research. Few analyses have however addressed the explanation of the volatility of earnings. The present paper provides with a comprehensive analysis of the influence of economic and financial factors through the sub-components of net earnings, using a panel of European banks.