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Efficiency and bank profitability in MENA countries

  • Olson, Dennis
  • Zoubi, Taisier A.

This study compares accounting-based and economic-based measures of efficiency and profitability of banks in ten Middle East and North Africa (MENA) countries. Accounting variables help explain cost and profit efficiency, but cost efficiency has little impact on profitability and profit efficiency. Our results suggest that researchers perhaps should focus more on profit efficiency than cost efficiency. MENA banks are slightly less cost efficient than European banks, but similar to banks in developing economies. However, MENA banks score well in terms of profit efficiency relative to banks world-wide. Finally, almost all banks in the MENA region are below optimal size.

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Article provided by Elsevier in its journal Emerging Markets Review.

Volume (Year): 12 (2011)
Issue (Month): 2 (June)
Pages: 94-110

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Handle: RePEc:eee:ememar:v:12:y:2011:i:2:p:94-110
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/620356

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