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Efficiency of commercial banks in Bulgaria in the wake of EU accession

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  • Kiril Tochkov
  • Nikolay Nenovsky

    ()

Abstract

The paper examines the efficiency of Bulgarian banks and its determinants over the period 1999- 2007. The levels of technical, allocative, and cost efficiency are first estimated using a nonparametric methodology and then regressed upon a number of bank-specific, institutional, and EU-related factors. The findings indicate that foreign banks were more efficient than domestic private banks, although the gap between them narrowed over time. State-owned banks ranked last on average but their privatization resulted in efficiency gains. Capitalization, liquid ity, and enterprise restructuring enhanced bank efficiency, while banking reforms had an adverse effect. The Treaty of Accession and EU membership were associated with significant efficiency improvements.

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File URL: http://www.icer.it/docs/wp2009/ICERwp21-09.pdf
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Bibliographic Info

Paper provided by ICER - International Centre for Economic Research in its series ICER Working Papers with number 21-2009.

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Length: 35 pages
Date of creation: Oct 2009
Date of revision:
Handle: RePEc:icr:wpicer:21-2009

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Keywords: Transition economies; Banking sector; Efficiency; EU accession;

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  1. Brissimis, Sophocles N. & Delis, Manthos D. & Papanikolaou, Nikolaos I., 2008. "Exploring the nexus between banking sector reform and performance: Evidence from newly acceded EU countries," Journal of Banking & Finance, Elsevier, vol. 32(12), pages 2674-2683, December.
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  4. Nikolay Nenovsky & Petar Chobanov & Gergana Mihaylova & Darina Koleva, 2008. "Efficiency of the Bulgarian Banking System: Traditional Approach and Data Envelopment Analysis," ICER Working Papers 22-2008, ICER - International Centre for Economic Research.
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Cited by:
  1. Marek Stefański, 2010. "Banking Sectors in the new European Union Member States," Contemporary Economics, University of Finance and Management in Warsaw, vol. 4(1), March.

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