This study attempts to measure the productivity of the banking industry by employing the nonparametric malmquist index approach. The finding has shown that there is a decline in productivity growth in the banking industry. Like the manufacturing sector, the future growth of this industry would depend on its ability to compete efficiently. Being able to provide service in an efficient way would be an important source of comparative advantage in the era of globalization. The results also suggest that the technical efficiency rather than technical progress contributes to the overall productivity growth of the industry.
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