Predicting bankruptcy and ensuring financial sustainability: A focus on Visegrad economies

Bankruptcy prediction lies in the need for financial institutions, investors, and stakeholders to assess the financial health and solvency of companies. Bankruptcy prediction models aim to forecast the likelihood of a business facing financial distress or going bankrupt in the future. The main aim of the paper is to build a bankruptcy prediction model utilizing financial information from 12,816 business entities in the Visegrad Group countries. Because multiple discriminant analysis provides important insights into corporate financial health, it is possible to develop individual prediction models for each Visegrad Group country as well as a comprehensive model for the entire group. Relevant debt ratios are crucial components of bankruptcy prediction models. The development of bankruptcy prediction models significantly enriches the theory and practice of corporate finance by offering valuable insights, improving decision-making processes, and enhancing risk management and it also provides insightful information on how different crises affect prediction models, especially when comparing the COVID-19 crisis model to previous models developed in a comparable way.