Analysis of the banking sector in terms of financial frigality BRICS and Turkey countries examples

Fragile Banking Sector is a serious financial risk for any country's economy. Banks are the main intermediary that allows exchange of funds between borrowers and lenders. Therefore, all the banking sector risks should be carefully monitored, and necessary measures and regulations should be made on time. In this thesis, the reasons that make the banking sector fragile are investigated theoretically and empirically. Using pioneering studies in the literature, econometric models that measure the fragility of the banking sector have been created. In addition to the financial indicators used in the literature, using the high frequency data, the econometric model was expanded using a Geopolitical Risk Index, with a different approach to financial vulnerability analysis as corporate data. In addition, in order to increase the up-to-date and originality of the thesis, the foreign trade terms data created by IMF employees, unlike the previous studies. In the thesis, using Logit Model, which is one of the frequently used and recommended methods in the literature to measure crises and vulnerabilities in the financial sector, different countries were compared with each other by making separate analyzes for each country. In addition to this, the comparative results of the two analysis methods are given by analyzing with the Panel Logit model. In the thesis Turkey and BRICS country's data are analyzed. According to the empirical results, the effects of the variables that determine the fragility of the banking sector may be in different directions depending on many factors such as richness of natural resources, foreign dependency on energy and geopolitical location also. The Industrial Production Index (IPI) is preferred instead of GDP, Depreciation, CDS premium and the Geopolitical Risk Index selected as the institutional indicator was statistically significant in the model. However, in the panel data analysis, it was seen that the Geopolitical Risk Index did not give statistically significant results. Keywords: Banking, Fragility Index, Geopolitical Risk, Industrial Production Index, BRICS, Panel, Logit