TY - JOUR
T1 - Determinants of efficiency in South East Asian banking
AU - Gardener, Edward
AU - Molyneux, Philip
AU - Nguyen, Linh
PY - 2011
Y1 - 2011
N2 - This paper explores the efficiency of banks in five South East Asian countries (Indonesia, Malaysia, the Philippines, Thailand, and Vietnam) using the nonparametric data envelopment approach and Tobit regression. The results indicate that efficiency has significantly declined over the period 1998–2004 indicating that the post-1997 crisis restructuring had a negative influence on bank performance. In line with the established literature on emerging markets, foreign banks appear to be more efficient than the domestic counterparts. However, state-owned banks exhibited greater efficiency than their local private sector peers. Among country-level factors, national banking development shows a strong and positive link with bank efficiency. The results are robust to different assumptions of bank inputs, outputs, technological changes, and national banking convergence.
AB - This paper explores the efficiency of banks in five South East Asian countries (Indonesia, Malaysia, the Philippines, Thailand, and Vietnam) using the nonparametric data envelopment approach and Tobit regression. The results indicate that efficiency has significantly declined over the period 1998–2004 indicating that the post-1997 crisis restructuring had a negative influence on bank performance. In line with the established literature on emerging markets, foreign banks appear to be more efficient than the domestic counterparts. However, state-owned banks exhibited greater efficiency than their local private sector peers. Among country-level factors, national banking development shows a strong and positive link with bank efficiency. The results are robust to different assumptions of bank inputs, outputs, technological changes, and national banking convergence.
KW - DEA
KW - efficiency
KW - South East Asian banking
KW - regulation
U2 - 10.1080/02642069.2010.512659
DO - 10.1080/02642069.2010.512659
M3 - Article
VL - 31
SP - 2693
EP - 2719
JO - Service Industries Journal
JF - Service Industries Journal
SN - 0264-2069
IS - 16
ER -