Operating Efficiency Measurement of Commercial Banks of Bangladesh: A Dea Approach

Md. Takibur Rahman, Md. Nur Nabi and Mohammad Muzahidul Islam
Additional contact information
Md. Takibur Rahman: Assistant Professor,Department of Accounting & Information Systems. Patuakhali Science and Technology University, Bangladesh
Md. Nur Nabi: Lecturer, Department of Finance & Banking, Patuakhali Science and Technology University, Bangladesh
Mohammad Muzahidul Islam: Lecturer, Department Management Studies, Patuakhali Science and Technology University, Bangladesh

Indian Journal of Commerce and Management Studies, 2011, vol. 2, issue 5, 12-23

Abstract: This paper attempts to measures the efficiency of some selected commercial banks (19) both from private (15) and public (4) sectors in Bangladesh with nonparametric method of Data Envelopment Analysis as a smart and powerful alternative to traditional efficiency measures. The performance evaluation of business has taken high profile in the climate of micro-economic reform in the recent past. The real wealth of banks can be increased by increasing the inputs available to the banks. That is by discovering new resources and using the existing resources more efficiently. Efficiency gains in the banking sector of the country will make the country domestically and internationally more competitive and capable of generating more income and employment opportunities in the country. An important objective of these measures is to assist to identify the way of increasing the operational efficiency of the banking sector as a whole as well as of individual institutions. In fact, policy makers are trying to identify the reasons of high level of cost of banking in Bangladesh that are usually viewed as a result of inefficiency. The study finds that among the sample banks Arab Bangladesh Bank is the star performers and Jamuna bank is the poor performers only in terms of the selected parameters. The study also identifies the areas of operational inefficiencies and efficiencies both for best and poor performers. This type of analysis can be used for a better quality-benchmark by the individual institutions than using industry averages or a particular peer bank as the benchmark.

Keywords: Data envelopment analysis (DEA); Efficiency; Bank; Decision Making Units (DMUs). (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://scholarshub.net/index.php/ijcms/article/view/458/447 (application/pdf)
http://scholarshub.net/index.php/ijcms/article/view/458 (text/html)

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:aii:ijcmss:v:2:y:2011:i:5:p:12-23

Access Statistics for this article

Indian Journal of Commerce and Management Studies is currently edited by Dr. Arif Anjum

More articles in Indian Journal of Commerce and Management Studies from Educational Research Multimedia & Publications,India
Bibliographic data for series maintained by Mr. Asif Anjum ().