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Bank specific, industry-specific and macroeconomic determinants of bank efficiency : empirical evidence from the Thai banking sector


Citation

Sufian, Fadzlan and Habibullah, Muzafar Shah (2010) Bank specific, industry-specific and macroeconomic determinants of bank efficiency : empirical evidence from the Thai banking sector. Margin : The Journal of Applied Economic Research, 4 (4). pp. 427-461. ISSN 0973-8010; ESSN; 0973-8029

Abstract

This paper examines the efficiency of the Thai banking sector from 1999 to 2008 by using the data envelopment analysis (DEA) method. The results indicate that inefficiency in the sector stems mainly from scale rather than pure technical efficiencies. The findings suggest that small banks are most efficient, while medium-sized banks have been the least efficient banking group. Domestic banks have been relatively more efficient than their foreign bank peers, which can be attributed largely to a higher pure technical efficiency (PTE) level. The results from the multivariate regression analysis suggest that banks with higher loans intensity and which are relatively better capitalised tend to exhibit higher efficiency levels. On the other hand, credit risk is negatively related to bank efficiency. The empirical findings suggest that the recent global financial crisis exerts a negative impact on the efficiency of Thai banks.


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Additional Metadata

Item Type: Article
Divisions: Faculty of Economics and Management
DOI Number: 10.1177/097380101000400403
Publisher: Sage Publications
Keywords: Banks; Efficiency; Data envelopment analysis; Panel regression analysis; Thailand
Depositing User: Azana Abd Hadi
Date Deposited: 26 Dec 2014 12:17
Last Modified: 26 Dec 2014 12:17
Altmetrics: http://www.altmetric.com/details.php?domain=psasir.upm.edu.my&doi=10.1177/097380101000400403
URI: http://psasir.upm.edu.my/id/eprint/22736
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