On FDH efficiency analysis: Some methodological issues and applications to retail banking, courts, and urban transit

Tulkens, Henry

doi:10.1007/bf01073473

Cited by 516 publications

(169 citation statements)

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“…The most recent studies include Camanho and Dyson (1999), Zenios (1999a, 1999b), Golany and Storbeck (1999), Kantor and Maital (1999), Soteriou et al (1999), Zenios et al (1999), Athanassopoulos and Giokas (2000), Athanassopoulos, Soteriou, and Zenios (2000), Cook, Hababou, and Tuentner (2000), Dekker and Post (2001), Hartman, Storbeck, and Byrnes (2001), Bala andCook (2003), Silva Portela et al (2003), and Paradi and Schaffnit (2004). A handful of studies have used FDH for the same purpose, including Respaut (1989), Tulkens (1993), and Tulkens and Malnero (1996). 3 An excellent illustration of the use of alternative empirical methodologies for cross-validation purposes is provided by Charnes, Cooper, and Sueyoshi (1988), who used DEA and goal programming to provide complementary analyses of the breakup of AT&T in the US.…”

Section: The Branch Office Financial Performance Datamentioning

confidence: 94%

“…, 573, converts the DEA linear program to an FDH mixed integer program. A simple minimax solution algorithm is described inTulkens (1993). 7 Dominance analysis is an under-utilized performance evaluation technique, although it has been used in a financial institutions context byFried, Lovell, and Eeckaut (1993),Fried and Lovell (1994) andTulkens and Malnero (1996).…”

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confidence: 99%

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Evaluating the financial performance of bank branches

2006

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We evaluate the financial performance of most of the branch offices of a large European savings bank for a recent accounting period. We employ a complementary pair of nonparametric techniques to evaluate their financial performance, in terms of their ability to conserve on the expenses they incur in building their customer bases and providing customer services. We find variation in the ability of branch offices to perform this task, and agreement on the identity of the laggard branches. We then employ parametric techniques to determine that the list of indicators on which their financial performance is evaluated can be reduced without statistically significant loss of information to bank management. Both findings suggest ways in which the bank can increase the profitability of its branch network.We examine the performance of a large European savings bank that currently operates a network of approximately 600 branch offices. Bank management collects and analyzes information on several expense, revenue and customer indicators from each branch office on * A previous version of this paper was presented at CORE, Université Catholique de Louvain, Louvain-laNeuve, Belgium, where we received many helpful comments from the audience. We are grateful to three referees for their helpful comments as well.

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Section: The Branch Office Financial Performance Datamentioning

confidence: 94%

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confidence: 99%

Evaluating the financial performance of bank branches

2006

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“…The RBI (2003) affirmed that "as regards the linkage between ownership and performance, international evidence suggests that ownership has limited impact on economic efficiency." Researches that hold this point include those of Tulkens (1993), Altunbus, Evans and Molynenx, (2000) and Denizer, Tarimcilar and Dinc (2000). Barr &Siems, (1994) study scrutinize that banks are more efficient with high efficiency scores and are more competent to carry on as compare to banks which have low efficiency scores.…”

Section: Review Of Literaturementioning

confidence: 99%

Efficiency of Foreign Banks Operating in India: DEA Analysis

Rajput

Chopra

Oberoi

2014

AJFA

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Indian financial sector has observed various modifications in the policies and prudential norms to raise the banking standards in India to the international strength. Various financial reforms have taken place in 1991 which improved flexibility and operational autonomy in the banking sector. In 1992, on the recommendation of Narasimham committee, a series of developments were instigated. In 1993-94, the approval was accepted for the entry of new private banks and foreign banks in Indian banking sector. After the post reform era, the operations of Foreign Banks (FBs) received a considerable boost. The Reserve Bank of India liberalized its policy for foreign banks implying new opportunities for growth and different representations in India. The present study makes an attempt to measure and compare the efficiency scores of Public Sector Banks (PSBs), Private Sector banks and FBs operating in India during 2008-2013 using frontier based non-parametric technique, i.e., DEA, the result demonstrates that the efficiency of FBs has shown continuous improvement in comparison with PSBs and Private Banks following the route of deregulation with modest drifts.

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“…Other benefits are such as it can be used to uncover relationship that remain hidden for other methodologies, the source of inefficiency can be analyzed and quantified for every evaluated decision unit. On other hand Free Disposable Hull (FDH) approach was found to be a special case of the DEA model where the points with lines connecting the DEA vertices are not included in the frontier (Tulkens, 1993). Despite the advantages of the above non parametric methods there are some weaknesses.…”

Section: Non-parametric Techniquesmentioning

confidence: 99%

Efficiency of Commercial Banks in East Africa: A Non Parametric Approach

Raphael

China²,

Jiao³

2013

IJBM

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This paper employs Data Envelopment analysis (DEA) to estimate the relative efficiency of selected 58 commercial banks operating within the East African Community, namely Tanzania (11) and Burundi (21). The findings show that most commercial banks in east Africa are operating under a decreasing return to scale. Therefore inefficient utilization of input resources (technical inefficiency) could be one of the reasons for the inefficiency of commercial banks in East Africa; therefore banks should make use of underutilized resources and reduce operating expenses to be relatively efficient in the production frontier.

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On FDH efficiency analysis: Some methodological issues and applications to retail banking, courts, and urban transit

Cited by 516 publications

References 15 publications

Evaluating the financial performance of bank branches

Evaluating the financial performance of bank branches

Efficiency of Foreign Banks Operating in India: DEA Analysis

Efficiency of Commercial Banks in East Africa: A Non Parametric Approach

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