In column three we present regression results using the z-score as the dependent variable.
The z-score is a widely used variable in the empirical banking literature to approximate
the overall level of banks. The success of the z-score can mostly be attributed to
the fact that it can be easily calculated from banks’ balance sheet information. Although
we think that using actual distress events is more appropriate when trying to study the
competition-risk nexus, we present, for reasons of comparability with the existing literature,
the results for the z-score model in the third column of Table 4.11