Efficiency Estimation of Commercial Banks Based on Financial Performance: Input Oriented DEA CRS/VRS Models

Marjanović Ivana (), Stanković Jelena J. () and Popović Žarko ()
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Marjanović Ivana: PhD student at the Faculty of Economics, University of Niš, Republic of Serbia
Stanković Jelena J.: Faculty of Economics, University of Niš, Republic of Serbia
Popović Žarko: Faculty of Economics, University of Niš, Republic of Serbia

Economic Themes, 2018, vol. 56, issue 2, 239-252

Abstract: Measurement and evaluation of the bank’s operations efficiency requires analytical techniques that provide data beyond those available from the standard analysis of financial statements. The Data Envelopment Analysis (DEA) is a mathematical programming technique that offers valuable insights in finding inefficient banks taking into account the scope of the services and resources used to provide these banking services. The results of the DEA analysis can provide significant information to the bank’s management that can supplement the information obtained using traditional techniques for assessing efficiency. The assessment of banks’ efficiency in the Republic of Serbia is of particular importance due to intense competition and implemented banking reforms. Therefore, in this paper DEA analysis will be applied for the examination and assessment of the efficiency of the operations of Serbian banks during the period 2014-2016. The analysis will show which of the banks operates efficiently, where the efficiency of the banks is not at a satisfactory level, as well as the potential reasons for inefficiency.

Keywords: Banks; efficiency; Data Envelopment Analysis; ratio analysis (search for similar items in EconPapers)
JEL-codes: C44 C67 G21 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:ecothe:v:56:y:2018:i:2:p:239-252:n:6

DOI: 10.2478/ethemes-2018-0014

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