Technical, scale and allocative efficiencies of Turkish banking industry

Isik, Ihsan; Hassan, M. Kabir

doi:10.1016/s0378-4266(01)00167-4

Cited by 400 publications

(355 citation statements)

References 38 publications

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“…This is caused by allocative inefficiency while the score for technical inefficiency was showed very high. Isik and Hassan [8] examined the input and output efficiency in the Turkish banking industry over the year 1988 to 1996. The author employed a non-parametric approach along the parametric approach to determine the efficiency of Turkish bank and understand the impact of size, allocation, scale efficiency, pure technical and technical efficiency measure.…”

Section: Literature Reviewmentioning

confidence: 99%

Efficiency measurement of the banking sector in the presence of non-performing loan

Hamid

Ramli

Hussin

2017

AIP Conference Proceedings

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A total norm of τ-adic non-adjacent form occurring among all element of ℤ(τ): An alternative formula AIP Conference Proceedings 1795, 020002 (2017) Abstract. Bank industry plays a vital role in a country's economic development. In the banking industry, the nonperforming loans which are acknowledged as being undesirable outputs and usually ignored in most of the analysis should be taken into account since they are undesirable by-products of producing loans and may lead to the bank inefficiency. Modelling the efficiency measurement without undesirable outputs can provide misleading results and unfair assessment. The Directional Distance Function (DDF) approach which extended from the Data Envelopment Analysis (DEA) framework is one of the enhancement efficiency approaches to handle a situation when there is a joint production of the desirable and undesirable outputs. The comparison of both results between the domestic and foreign banks shows that the DEA technical efficiency score for domestic banks is marginally higher than the Malaysian foreign banks. However, when incorporating the undesirable output, the DDF technical efficiency for foreign banks is slightly higher than domestic banks.

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Section: Literature Reviewmentioning

confidence: 99%

Efficiency measurement of the banking sector in the presence of non-performing loan

Hamid

Ramli

Hussin

2017

AIP Conference Proceedings

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“…In addition it includes as a special case the Cobb-Douglas (Carvalo and Kasman, 2005) However, most of the parametric models applied to financial institutions were interested in the study of the cost efficiency. Thus, we could pick up these last years a certain resurgence of interest for efficiency advantage (Isik and Hassan, 2002;Al-Jarrah and Molyneux, 2003;Mohamed and Molyneux, 2003;Srairi, 2010). This concept requires that the Manager should not only pay attention to the reduction of the marginal dollar of costs, but also to the increase in the marginal dollar of revenue.…”

Section: -Efficiency Scoresmentioning

confidence: 99%

The Determinants of Cost/Profit Efficiency of Islamic Banks Before, During and After the Subprime Crisis Using SFA Approach

Mghaieth

Khanchel

2015

ijafr

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In this paper we estimate the determinants of cost and profit efficiency of Islamic banks using the stochastic frontier approach SFA. We use 62 Islamic banks in sixteen countries of the MENA and South-East Asia regions during the period [2004][2005][2006][2007][2008][2009][2010]. We compare the efficiency between Islamic banks during the subprime crisis phases. Moreover, we examine the variables specific to the banks which can explain the sources of inefficiency and those let us decline the scores of cost and profit efficiency on a specific number of variables (total assets, capital adequacy, profitability, credit risk, operational costs). Results reveal that, Islamic banks in our study are more efficient in the generation of the profits rather than in the control of the costs. Thus, only the total assets and the operational costs represent the determinants of cost efficiency of the Islamic banks. Finally, for the profit efficiency our results indicate that the Islamic banks with high equities and high ratio of profitability are efficient in terms of profit.

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“…As against this view, some empirical findings support the conclusion that foreign banks are more efficient in developing countries relative to domestic banks arising from exploitation of their comparative advantages. (Bhattacharyya et al, 1997;Grigorian & Manole, 2002;Hasan & Marton, 2003;Isik & Hassan, 2002;Zajc 2006).…”

Section: Literature Reviewmentioning

confidence: 99%

Bank Ownership and Efficiency in Post-conflict Era: Evidence from Sri Lanka

2014

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This paper aims to explore the changes in efficiency of state-owned, domestic private and foreign banks in Sri Lanka after the ending of the 26 year long armed-conflict between the government and ethnic Tamil rebels in 2009. (The Liberation Tigers for Tamil Eelam (LTTE) fought for a separate state called "Tamil Eelam" from 1983 to 2009. Government forces defeated the LTTE rebels in mid-2009 through military operations and capturing all the land belonging to their de facto state for more than a decade.) Data Envelopment Analysis (DEA) along with the bootstrap simulation technique is employed to derive bank-wise efficiency scores. Two approaches, namely the intermediation and operating approaches, are used to measure the efficiency of banks and to analyse banking performance from multiple perspectives. The results show that, under the intermediation approach, in general state-owned banks were less efficient than domestic private banks in 2009 and 2010, but the relative efficiency of state-owned banks improved in 2011 and 2012 surpassing both domestic private and foreign banks. In contrast our results reveal that under the profit-oriented operating approach, state-owned and foreign banks show superior average efficiency than domestic private banks. The findings reflect the strong positioning of state-owned banks, in line with the post-conflict economic expansion of Sri Lanka, in providing efficient banking services.

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Technical, scale and allocative efficiencies of Turkish banking industry

Cited by 400 publications

References 38 publications

Efficiency measurement of the banking sector in the presence of non-performing loan

Efficiency measurement of the banking sector in the presence of non-performing loan

The Determinants of Cost/Profit Efficiency of Islamic Banks Before, During and After the Subprime Crisis Using SFA Approach

Bank Ownership and Efficiency in Post-conflict Era: Evidence from Sri Lanka

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