Declining cost efficiency as a signal of increasing bank vulnerability: an entropy-based approach

Lakshmi Balasubramanyan (), Spiro Stefanou and Jeffrey Stokes

Applied Economics Letters, 2010, vol. 17, issue 18, 1769-1781

Abstract: The mortgage crisis of 2007/08 has impacted the health of both small and large commercial banks in the financial services industry. The pressing question is how do regulators and bank monitors identify the warning signals of bank vulnerability and bank risk because of weakening credit and asset markets. Linking poor bank performance and efficiency, we employ an information theoretic approach to derive the cost efficiency scores and evaluate the effects of crisis signalling factors such as different types of loans on cost efficiency of the smallest and largest commercial banks.

Date: 2010
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.informaworld.com/openurl?genre=article& ... 40C6AD35DC6213A474B5 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:apeclt:v:17:y:2010:i:18:p:1769-1781

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEL20

DOI: 10.1080/13504850903357368

Access Statistics for this article

Applied Economics Letters is currently edited by Anita Phillips

More articles in Applied Economics Letters from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().