An Examination of Banks’ Cost Efficiency in Central and Eastern Europe

Niţoi, Mihai; Spulbăr, Cristi

doi:10.1016/s2212-5671(15)00256-7

Cited by 32 publications

(31 citation statements)

References 14 publications

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“…Agapova & McNulty (2016) used bank interest rate spreads as measures of financial intermediation and examined the relationship between spreads and bank efficiency in the transition economies of Central and Eastern Europe, and they tested the relationships between spread and macroeconomic factors. Niţoi & Spulbar (2015) investigated the cost efficiency differences of commercial banks in Central and Eastern Europe, using a heteroscedastic SFA. They included variables that measured the level of economic development, macroeconomic stability, credit risk, solvency risk, bank performance, loan specialization, the liquidity level, and the efficiency of the financial intermediation process.…”

Section: Studies On Bank Performance In the Cee Countriesmentioning

confidence: 99%

Determinants of financial performance of banks in Central and Eastern Europe

Antoun¹,

Çoşkun²,

Georgievski³

2018

BEH

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The aim of this study is to investigate the bank-specific, industry-specific, and macroeconomic determinants of the financial performance of banks in Central and Eastern European Countries. For this purpose, first we determined the factors affecting performance, based on findings in the literature. We constructed a financial performance index (FPI) based on CAMEL ratios and then ran the computed index on the aforementioned determinants. In the analysis, we used unbalanced panel data covering the period 2009-2014, which were collected from the BankScope database, World Development Indicators, and the Financial Structure and Development Dataset. We conducted an empirical analysis using fixed-effect panel regression. Our results suggest that the asset quality and earnings of banks are negatively affected by size, and positively affected by business mix and inflation. Capital adequacy and liquidity were found to be negatively affected by size and positively affected by bank concentration and economic growth.

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Section: Studies On Bank Performance In the Cee Countriesmentioning

confidence: 99%

Determinants of financial performance of banks in Central and Eastern Europe

Antoun¹,

Çoşkun²,

Georgievski³

2018

BEH

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“…SFA in determining efficiency is used in the study as also employed by Altunbas et al (2007;2001;; Kwan and Eisenbeis (1997); Girardone et al (2004) and Niţoi and Spulbar (2015). This paper opted for production function Four equations specify empirical models of the study.…”

Section: Model Specificationmentioning

confidence: 99%

Do Human Capital and Cost Efficiency Affect Risk and Capital of Commercial Banks? An Empirical Study of a Developing Country

Zheng

Gupta

Moudud‐Ul‐Huq

2018

Asian Economic and Financial Review

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Article History JEL Classification:C2, G17, D22, G28, F20.As a striking force and operational optimization, human capital and cost efficiency of commercial banks are worth considering factors in decision making. Using simultaneous equation models this study delves the interrelationship between bank risk, capital and efficiency of a sample developing country-Bangladesh incorporating new dimension human capital efficiency along with existing cost efficiency through Stochastic Frontier Analysis (SFA). The empirical results of generalized methods of moments estimator (GMM estimator) from 2000-2015 show that capitalized commercial banks are more capable of absorbing risk and enhancing human capital efficiency. Increasing amount of risk leads banks to improve their level of capital but that reduces the cost efficiency of banks. We also find the significant impact of risk and capital on the efficiency of banks. With the increase of capital and risk, the human capital of banks behaves more efficiently whereas the efficiency of cost reduces substantially. Although no significant relationship observed between risk and human capital efficiency in risk equation, the inefficiency of cost find inversely associated with risk and positively associated with capital in risk and capital equations respectively. Contribution/ Originality: This study originates new estimation of technical efficiency named Human capital efficiency along with existing cost efficiency using Stochastic Frontier Analysis to examine the simultaneous relationship between risk, capital, and efficiency of a sample Asian country Bangladesh.

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“…Their findings indicate that efficiency intensifies with demand density and market concentration and declines with the increase of the number of bank branches in local markets. Niţoi and Spulbar (2015) investigate the period from 2005 to 2011 on the sample of six developing countries from Central and Eastern Europe. They use a heteroscedastic stochastic frontier model in order to inspect the differences of commercial banks cost efficiency.…”

Section: Literature Review and Methodologymentioning

confidence: 99%

Efficiency Estimation of Commercial Banks Based on Financial Performance: Input Oriented DEA CRS/VRS Models

2018

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Measurement and evaluation of the bank’s operations efficiency requires analytical techniques that provide data beyond those available from the standard analysis of financial statements. The Data Envelopment Analysis (DEA) is a mathematical programming technique that offers valuable insights in finding inefficient banks taking into account the scope of the services and resources used to provide these banking services. The results of the DEA analysis can provide significant information to the bank’s management that can supplement the information obtained using traditional techniques for assessing efficiency. The assessment of banks’ efficiency in the Republic of Serbia is of particular importance due to intense competition and implemented banking reforms. Therefore, in this paper DEA analysis will be applied for the examination and assessment of the efficiency of the operations of Serbian banks during the period 2014-2016. The analysis will show which of the banks operates efficiently, where the efficiency of the banks is not at a satisfactory level, as well as the potential reasons for inefficiency.

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An Examination of Banks’ Cost Efficiency in Central and Eastern Europe

Cited by 32 publications

References 14 publications

Determinants of financial performance of banks in Central and Eastern Europe

Determinants of financial performance of banks in Central and Eastern Europe

Do Human Capital and Cost Efficiency Affect Risk and Capital of Commercial Banks? An Empirical Study of a Developing Country

Efficiency Estimation of Commercial Banks Based on Financial Performance: Input Oriented DEA CRS/VRS Models

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