Schumpeterian competition and efficiency among commercial banks

Duygun, Meryem; Sena, Vania; Shaban, Mohamed

doi:10.1016/j.jbankfin.2013.07.003

Cited by 41 publications

(25 citation statements)

References 34 publications

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“…A variety of different methodological approaches have been used that include both parametric and non-parametric techniques (Berger & Mester, 1997;Carbó, Humphrey, & López del Paso, 2007;Duygun, Sena, & Shaban, 2013). Different concepts of efficiency have also been analyzed, including technical, cost and profit efficiency (Wheelock & Wilson, 2013), as well as the impact on efficiency of different environmental variables, i.e.…”

Section: Efficiency In the Lac Banking Industry: A Brief Review Of LImentioning

confidence: 99%

Assessing the performance of the Latin American and Caribbean banking industry: Are domestic and foreign banks so different?

Sáez-Fernández

Picazo‐Tadeo

Beltrán-Esteve

2015

Cogent Economics & Finance

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This paper studies the relative performance of domestic and foreign banks in the Latin American and Caribbean banking industry. Data Envelopment Analysis is used to compute technical efficiency scores for the years 2001 and 2013. Our main contribution is twofold. On the one hand, we assess performance at the level of the management of specific production factors. On the other hand, we distinguish program efficiency from managerial efficiency, which allows us to evaluate whether the differences in technical efficiency between national and foreign banks are due to the use of different technologies (program efficiency) or, conversely, differences in the managerial capacities of managers in both categories of banks (managerial efficiency). The results show that foreign banks are more efficient than domestic ones, and provide evidence that the greater efficiency of foreign banks is mostly due to the superior technology they use.The financial crises experienced by the Latin American and Caribbean region in the 1980s and the first half of the 1990s boosted reforms in the banking system aimed at adapting banks to international solvency standards, liberalizing their operational capacity, opening to international competition, and increasing their efficiency and productivity. Foreign banks were encouraged to enter these countries and were also meant to play a leadership role in the process of modernization; however, the role they actually played still remains a cause for debate. This paper contributes to this ongoing debate by analyzing performance in the regional banking industry. Our results show that foreign banks are managed more efficiently than their domestic counterparts; furthermore, this superiority is determined to a great extent by the use of more efficient technologies. Accordingly, our results appear to support the opening up of the Latin American industry, and the positive role of foreign banks in its modernization.

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Section: Efficiency In the Lac Banking Industry: A Brief Review Of LImentioning

confidence: 99%

Assessing the performance of the Latin American and Caribbean banking industry: Are domestic and foreign banks so different?

Sáez-Fernández

Picazo‐Tadeo

Beltrán-Esteve

2015

Cogent Economics & Finance

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“…This explains why the banking literature is flooded with empirical analyses of bank profitability (Dietrich & Wanzenried, 2014;Duygun, Sena, & Shaban, 2013;Flamini, Schumacher, & McDonald, 2009;Mirzaei, Moore, & Liu, 2013;Sufian & Habibullah, 2009;Sufian & Noor Mohamad Noor, 2012). However, these studies have shown that ascertaining the determinants of bank profitability remains inadequately addressed since the statistical significance of the identified variables varies across countries and sample periods (Kanas et al, 2012).…”

Section: Introductionmentioning

confidence: 99%

Bank profitability: Insights from the rural banking industry in Ghana

Adusei

2015

Cogent Economics & Finance

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This paper analyzes the profitability of 112 rural banks (special unit banks created to promote rural financial intermediation in Ghana). The results generally show that bank size, funding risk, diversification, liquidity risk, and bank stability are significant predictors of rural bank profitability. Whereas an improvement in the funding risk of a rural bank in a particular period portends a drop in its profitability in the future, an improvement in the size, diversification, liquidity risk, and stability of a rural bank signifies an improvement in the future profitability of the bank.

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“…Among these works, some studies focused on the relationship between efficiency and some environmental variables or managerial variables. The main contributions studied the banking system in France [18], Germany [19], Italy [20][21][22][23][24], Spain [25], Greek [16], United Kingdom [26], America [12,[27][28][29][30][31][32], Australia [33], China [34] and Japan [35,36]. Other studies tried to compare the banking system of different countries [37][38][39][40][41][42][43][44].…”

Section: Literature Reviewmentioning

confidence: 99%

Sustainability and Efficiency of the European Banking Market after the Global Crisis: The Impact of Some Strategic Choices

Pampurini

Quaranta

2018

Sustainability

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Abstract:In the last few years, financial managers, supervisors and policy makers have been collectively engaged on the role of the banking and financial sector in relation to environmental and sustainability issues. The efficiency level that characterizes the production process of banks and financial intermediaries is strictly interconnected with sustainability so that, from a long term perspective, cost and profit efficiency reveals to be one of the most important premises for sustainability. This work aimed to analyze the level of efficiency achieved by European banking groups to verify if some key drivers of efficiency deriving from strategic choices outlined by literature on single banks (i.e., size, number of branches, cost income ratio and geographical location) are the same when considering banking groups. The study is focused on the period 2011-2016 that is characterized by, at least, two critical events that occurred after the sub-prime crisis. The level of efficiency of each banking group was measured with the Stochastic Frontier Approach and then the units were clustered into three homogeneous sets. Observing these clusters, the results show that the groups belonging to some specific countries appear to be more efficient with respect to others. Moreover, the banking groups characterized by many branches and a high level of cost income ratio exhibit a medium level of efficiency. Eventually, the biggest banking groups are the least efficient.

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Schumpeterian competition and efficiency among commercial banks

Cited by 41 publications

References 34 publications

Assessing the performance of the Latin American and Caribbean banking industry: Are domestic and foreign banks so different?

Assessing the performance of the Latin American and Caribbean banking industry: Are domestic and foreign banks so different?

Bank profitability: Insights from the rural banking industry in Ghana

Sustainability and Efficiency of the European Banking Market after the Global Crisis: The Impact of Some Strategic Choices

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