Efficiency of Commercial Banks in Sub-Saharan Africa: A Comparative Analysis of Domestic and Foreign Banks

Hiroyuki Kiyota

No wp-2011-058, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: Utilizing the stochastic frontier approach, this study conducts a comparative analysis of profit efficiency and cost inefficiency of commercial banks operating in 29 sub-Saharan African (SSA) countries by bank ownership (domestic bank, SSA foreign bank or non-SSA foreign bank), as well as by the bank size during 2000-07. Tobit regressions are employed to assess the impact of environmental factors on the efficiency of commercial banks. The key findings of this empirical analysis suggest that foreign banks tend to outperform domestic banks in terms of profit efficiency.

Keywords: Banking; Financial institutions; Financial institutions; International; Industrial organization (Economic theory) (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (7)

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