Profit efficiency of banks in Colombia with undesirable output: A directional distance function approach

Camilo Almanza and Jhon Mora Rodriguez ()

Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), 2018, vol. 12, No 2018-30, 18 pages

Abstract: This article analyzes the sources of bank efficiency in Colombia over the period 2000-2011. To perform this research, the authors propose a score of bank efficiency using the directional distance function, which was estimated using data envelopment analysis. Additionally, they use an ordered probit panel regression to explore the effects of some market-related and bank-specific factors on efficiency. The results show that the non-inclusion of non-performing loans (NPLs) leads to higher bank inefficiency indicators, which are significantly different from those obtained when NPLs are included. Further, they find that economic growth, capital risk, foreign and national banks, and account liquidity risk explain, in part, the efficiency of Colombian banks.

Keywords: data envelopment analysis; Colombia; directional distance function; non-per-forming loans; ordered probit panel models (search for similar items in EconPapers)
JEL-codes: D22 G21 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://dx.doi.org/10.5018/economics-ejournal.ja.2018-30
https://www.econstor.eu/bitstream/10419/178691/1/1023132753.pdf (application/pdf)

Related works:
Working Paper: Profit efficiency of banks in Colombia with undesirable output: A directional distance function approach (2017)
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:zbw:ifweej:201830

DOI: 10.5018/economics-ejournal.ja.2018-30

Access Statistics for this article

Economics - The Open-Access, Open-Assessment E-Journal (2007-2020) is currently edited by Dennis J. Snower

More articles in Economics - The Open-Access, Open-Assessment E-Journal (2007-2020) from Kiel Institute for the World Economy (IfW Kiel) Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().