An application of data envelopment analysis for measuring the relative efficiency in banking industry

Soltanifar, Mehdi; Farhadi, Fereshteh

doi:10.5267/j.msl.2014.3.008

Cited by 7 publications

(4 citation statements)

References 21 publications

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“…Besides, we compare our results to those reported in the related recent literature. Hence, our results are similar to those reported by Soltanifar and Farhadi (2014) and Ghotbuee et al (2012) who used an output-oriented DEA to measure the relative efficiency of some Iranian private banks and found that most of banks are efficient. However, Takbiri et al (2015) examined 120 bank branches in city of Tehran and found that only 50 out of 120 branches are efficient.…”

Section: Interpretation Of the Estimation Results Of The Frontier Modelsupporting

confidence: 90%

Estimation of the efficiency of Tunisian bank branches using a stochastic frontier approach

Aissia¹,

Ellouz²

2021

SN Bus Econ

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This article examines the efficiency scores of 94 Tunisian bank branches opening under the same public bank. It estimates the efficiency scores assigned to each bank branch using a model of the parametric method, namely the stochastic frontier approach (SFA). This method allows to isolate the term of random error, which reflects the inefficiency of each bank branch. Using data over the period 2007-2019, the paper shows that the branches of our sample present relatively similar levels of efficiency. It also identifies that the branches with the highest efficiency scores are those of the Northeast governorates.

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Section: Interpretation Of the Estimation Results Of The Frontier Modelsupporting

confidence: 90%

Estimation of the efficiency of Tunisian bank branches using a stochastic frontier approach

Aissia¹,

Ellouz²

2021

SN Bus Econ

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“…The labour price, capital price, and market share were found to be the significant variables in measuring the efficiency of the banks. Soltanifar and Farhadi (2014) measured relative efficiency of Iranian banks using DEA; Andersen and Petersen's approach was utilised for the measurement of super efficiency for ranking efficient banks. Das and Ghosh (2009) investigated the post-reform period (1992)(1993)(1994)(1995)(1996)(1997)(1998)(1999)(2000)(2001)(2002)(2003)(2004) performance of commercial banks in India, and the results highlighted that state-owned banks were more competitive.…”

Section: Literature Reviewmentioning

confidence: 99%

Measuring the performance efficiency of banks in a developing economy

Chaluvadi

Raut

Gardas³

2018

BIJ

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Purpose The purpose of this paper is to measure and evaluate the performance efficiency of 44 Indian commercial banks, out of which 26 banks belong to the public sector, and 18 banks are from the private sector for the period of 2008-2013. Design/methodology/approach The two-stage network data envelopment analysis (DEA) approach (i.e. variable return to scale and constant return to scale) is used for the measurement of performance in the Indian banking sector. To verify the robustness of the proposed study, sensitivity analysis is also performed. Findings A comparative study between public sector banks (PSBs) and private sector banks (PVBs) showed that latter being more productive compared to the former. The investigation highlighted that two banks are most efficient among the PSBs, and eight banks from PVBs are found to be most effective. On the other side, the performance of State Bank of Bikaner & Jaipur and Lakshmi Vilas Bank is discovered to be less significant from PSB and PVB category, respectively. Research limitations/implications This study will guide the Indian banks to improve upon the factors in which they are lagging, for the improvement of their overall performance. The quality category parameters, i.e. quality of service, quality of equipment, are not considered due to unavailability of information in the output measures, and the methodology used for the study does not identify the causes or remedies for the inefficiency of the banks. Originality/value The developed DEA model would help the decision maker to take decisions on the issues related to the performance of the banks. This paper discusses very practical issues in an analytic manner.

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“…Zarinkamar and Alam-Tabriz (2014), for instance, measured the relative efficiency of other banks and reported that most banks were inefficient. Soltanifar and Farhadi (2014) and Ghotbuee et al (2012) presented an output oriented DEA to measure the relative efficiency of some Iranian private banks in Iran and reported that most banks were efficient. 100 117 1 1 1 30 58 1 1 1 25 118 1 1 1 50 59 1 1 1 33 119 1 1 1 35 60 1 1 1 26 120 1 1 1 31…”

Section: Results Discussion and Conclusionmentioning

confidence: 99%

The efficiency of bank branches

Takbiri¹,

Mohammadi

Naderi³

2015

10.5267/j.msl

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Banking industry has significant contribution in development of economies of developing countries. Most banks execute their operations through different branches. Therefore it is important to measure the relative efficiencies of these branches. Data envelopment analysis (DEA) is one of the most useful tools in measuring banks' performance. The present paper aims to extract ranking pattern of banks based on performance evaluation using DEA analysis. In the present research, 120 bank branches of Bank Shahr in city of Tehran were selected and their efficiencies were evaluated using DEA technique. The results are discussed and compared with similar studies.

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An application of data envelopment analysis for measuring the relative efficiency in banking industry

Cited by 7 publications

References 21 publications

Estimation of the efficiency of Tunisian bank branches using a stochastic frontier approach

Estimation of the efficiency of Tunisian bank branches using a stochastic frontier approach

Measuring the performance efficiency of banks in a developing economy

The efficiency of bank branches

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