Investigating the effect of company helplessness risk on bank credit risk

The relationship between different risks in the banking industry is very important due to the nature of their operation and the effect of companies' risk of helplessness on credit risk of banks and the possibility of crisis in them is one of the most important topics considered by the banking industry during financial crises. Therefore, based on this argument, the present study investigates the contagiousness of companies 'financial distress risk on banks' credit risk. For this purpose, to measure the contagiousness model of financial distress risk, Akhtar and Dali (2017) theory of limit value was used. The hypotheses were tested using the statistical method of regression analysis with composite data using the information of 106 companies listed on the Tehran Stock Exchange during the years 1393 to 1398. The findings of the research hypothesis indicate that the risk of financial helplessness of the Iranian banking system is transmitted in the form of credit risk.