Risk management and managerial efficiency in Chinese banks: A network DEA framework

Kent Matthews

Omega, 2013, vol. 41, issue 2, 207-215

Abstract: Risk management in Chinese banks has traditionally been the Cinderella of its internal functions. Political stricture and developmental imperative have often overridden standard practice of risk management resulting in large non-performing loan (NPL) ratios. The training and practice of risk managers remain second class compared with foreign banks operating in China. This paper surveys Chinese bank risk managers and constructs metrics of risk management practice and risk management organisation. The metrics are used as intermediate inputs in a Network DEA framework to produce a measure of income efficiency. A statistical test is carried out to assess the importance of the risk metrics in evaluating bank income efficiency.

Keywords: Risk management; Risk organisation; Managerial efficiency; Network DEA (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (66)

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Related works:
Working Paper: Risk Management and Managerial Efficiency in Chinese Banks: A Network DEA Framework (2011)
Working Paper: Risk Management and Managerial Efficiency in Chinese Banks: A Network DEA Framework (2010)
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DOI: 10.1016/j.omega.2012.06.003

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