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Regulatory Policy and the Efficiency of the Banking Sector in Australia


  • Satya Paul
  • Khaled Kourouche


"This paper examines the technical efficiency of Australian banks during the post-Wallis period (1997-2005). The results based on data envelopment analysis reveal that the extent of technical efficiency varies across the banks and over the years. The National Australia Bank, Commonwealth Bank and Macquarie Bank are found to be technically efficient, whereas Adelaide Bank, the Bank of Queensland and Westpac Bank are found to be prominently inefficient. Technical efficiency is the lowest among small banks and has declined over time largely due to deterioration in scale efficiency. Medium-sized banks have outperformed both the small and large banks in terms of efficiency improvements. Some insights into the debate over the removal of the 'four-pillar' policy are provided." Copyright (c)2008 The University of Melbourne, Melbourne Institute of Applied Economic and Social Research.

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  • Satya Paul & Khaled Kourouche, 2008. "Regulatory Policy and the Efficiency of the Banking Sector in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 41(3), pages 260-271, September.
  • Handle: RePEc:bla:ausecr:v:41:y:2008:i:3:p:260-271

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    References listed on IDEAS

    1. Sandrey, Ronald A. & Reynolds, Russell G., 1990. "Farming Without Subsidies: New Zealand's Experience in the 1980s," 1990 Conference (34th), February 13-15, 1990, Brisbane, Australia 145356, Australian Agricultural and Resource Economics Society.
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    Cited by:

    1. Paul Rouse & Julie Harrison & Li Chen, 2010. "Data Envelopment Analysis: A Practical Tool to Measure Performance," Australian Accounting Review, CPA Australia, vol. 20(2), pages 165-177, June.
    2. Amir Moradi-Motlagh & Ali Salman Saleh, 2014. "Re-Examining the Technical Efficiency of Australian Banks: A Bootstrap DEA Approach," Australian Economic Papers, Wiley Blackwell, vol. 53(1-2), pages 112-128, June.
    3. Salim, Ruhul & Arjomandi, Amir & Seufert, Juergen Heinz, 2016. "Does corporate governance affect Australian banks' performance?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 43(C), pages 113-125.
    4. Moradi-Motlagh, Amir & Babacan, Alperhan, 2015. "The impact of the global financial crisis on the efficiency of Australian banks," Economic Modelling, Elsevier, vol. 46(C), pages 397-406.

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