Efficiency Dynamics and Financial Reforms: Case Study of Pakistani Banks
AbstractBanking sector in Pakistan were facing problems of weak health and low profitability due to various factors i.e. low productivity, high intermediation cost (high cost deposits), huge expenditures on establishment, over staffing, large number of loss making branches and mismanagement of funds etc. Owing to this, banking sector in Pakistan was under great deal of pressure to maintain their profitability. To overcome these issues, Pakistan undertook financial sector reforms in early 1990s with financial support of World Bank and Japanese government under the banking sector adjustment loan (BSAL) program. The main goal of these reforms was to improve the Total Factor Productivity (TFP) of financial system through separating ownership, management and strengthening the accountability mechanism. Using the data sets of 20 domestic commercial banks of Pakistan, this study is intended to measure the banking efficiency through Data Envelopment Analysis (DEA) Malmquist Index of Total Factor Productivity (TFP) from 1990 to 2005 to access the impact of reforms on banking sector. The analysis is useful not only for policy makers but it also assess the impact of reforms on domestic commercial banks of Pakistan
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 15054.
Date of creation: 2009
Date of revision:
Reforms; Banking; TFP analysis;
Find related papers by JEL classification:
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Nadeem Ul Haque, 1997. "Financial Market Reform in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, Pakistan Institute of Development Economics, vol. 36(4), pages 839-854.
- Rangan, Nanda & Grabowski, Richard & Aly, Hassan Y. & Pasurka, Carl, 1988. "The technical efficiency of US banks," Economics Letters, Elsevier, Elsevier, vol. 28(2), pages 169-175.
- Piyu Yue, 1992. "Data envelopment analysis and commercial bank performance: a primer with applications to Missouri banks," Review, Federal Reserve Bank of St. Louis, issue Jan, pages 31-45.
- Syed Fawad Ali Rizvi, 2001. "Post-liberalisation Efficiency and Productivity of the Banking Sector in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, Pakistan Institute of Development Economics, vol. 40(4), pages 605-632.
- Allen N. Berger & David B. Humphrey, 1997.
"Efficiency of Financial Institutions: International Survey and Directions for Future Research,"
Center for Financial Institutions Working Papers, Wharton School Center for Financial Institutions, University of Pennsylvania
97-05, Wharton School Center for Financial Institutions, University of Pennsylvania.
- Berger, Allen N. & Humphrey, David B., 1997. "Efficiency of financial institutions: International survey and directions for future research," European Journal of Operational Research, Elsevier, Elsevier, vol. 98(2), pages 175-212, April.
- Allen N. Berger & David B. Humphrey, 1997. "Efficiency of financial institutions: international survey and directions for future research," Finance and Economics Discussion Series, Board of Governors of the Federal Reserve System (U.S.) 1997-11, Board of Governors of the Federal Reserve System (U.S.).
- Berg, Sigbjorn Atle & Forsund, Finn R. & Hjalmarsson, Lennart & Suominen, Matti, 1993. "Banking efficiency in the Nordic countries," Journal of Banking & Finance, Elsevier, Elsevier, vol. 17(2-3), pages 371-388, April.
- Parkan, Celik, 1987. "Measuring the efficiency of service operations: An application to bank branches," Engineering Costs and Production Economics, Elsevier, Elsevier, vol. 12(1-4), pages 237-242, July.
- Mohammad Hanif Akhtar, 2002. "X-efficiency Analysis of Commercial Banks in Pakistan: A Preliminary Investigation," The Pakistan Development Review, Pakistan Institute of Development Economics, Pakistan Institute of Development Economics, vol. 41(4), pages 567-580.
- Aly, Hassan Y, et al, 1990. "Technical, Scale, and Allocative Efficiencies in U.S. Banking: An Empirical Investigation," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 211-18, May.
- Kumar, Ronald/R, 2011. "Role of Trade, Aid, Remittances and Financial Development in Pakistan," MPRA Paper 38871, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
If references are entirely missing, you can add them using this form.