Using historical data on post-war financial crises around the world, we show that combination of rapid credit and asset price growth over prior three years, whether in nonfinancial business or household sector, is associated with a 40% probability entering crisis within next years. This compares roughly 7% normal times, when neither nor elevated. Our evidence challenges view are unpredictable “...

Often, systemic banking crises initiate from one or more banks and affect countries by rapid spreading in the banking network, financial markets and economy of countries. According to Reinhart & Rogoff (2009) in the book titled "This time is Different," financial crises are pointed as an equal opportunity menace for high-income countries and emerging markets. Although The International Mo...