The Great Financial Crisis shows that bank failure in the United States, while rare, is a concern during uncertain times. Our interest is in the ability to predict future failures at the start of a crisis, when the recent past has few events on which to base our inferences. We show that...

The recent financial crisis and economic recession has shown that bank failure in the United States, while rare is a concern during uncertain times. Understanding the magnitude of banks at risk early in a crisis is a key challenge faced by policymakers. Early warning models are quite accurate at...