Forecasting financial failure in the banking system and an empirical analysis

From the point of view of the country?s economy, financial failure is an important issue which has to be investigated. The growth in the number of firms which faced financial failure is an indicator of bad evaluation of country?s resources. Using ineffectively insufficient resources, as a consequence, makes inflation increase. Another reason which increases the importance of the financial failure studies, the bankruptcy which is the ultimate failure, is not only the case with which small firms face, but also has the same inflence on the big firms.From time to time because of increasing competition and various reasons businesses which are known to have an endless life can face financial failure. But, unsuccessful businesses are going bankrupt and have to go into liquidation. These kinds of bussinesses are be a burden to economy and they harm to their credıt institutions and their small investors.The aim of this study is to create a model which can determine financial failures in Banks, one, two and three years ahead . At the same time to show the reasons of banks failures and the financial ratios which are considered to have an important impact on the prediction.