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An Analysis of Differences in Earnings Between Small and Large Commercial Banks

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  • P.A.V.B. Swamy
  • George Tavlas
  • Thomas Lutton

Abstract

This paper introduces a simple, yet rich, measure of efficiency changes based on the revenue-generating-ability (RGA) principle. Using this principle, we explain the connections between efficiency changes and the variables, such as pretax profits, interest expense, non-interest expense, profit margins, loan loss provision, and asset quality. These connections are used to explain earnings differences between small and large commercial banks. Copyright Kluwer Academic Publishers 2003

Suggested Citation

  • P.A.V.B. Swamy & George Tavlas & Thomas Lutton, 2003. "An Analysis of Differences in Earnings Between Small and Large Commercial Banks," Journal of Productivity Analysis, Springer, vol. 20(1), pages 97-114, July.
    • Handle: RePEc:kap:jproda:v:20:y:2003:i:1:p:97-114
    DOI: 10.1023/A:1024826326181
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    References listed on IDEAS

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    1. Rhoades, Stephen A., 1998. "The efficiency effects of bank mergers: An overview of case studies of nine mergers," Journal of Banking & Finance, Elsevier, vol. 22(3), pages 273-291, March.
    2. Boyd D. Anderson & Timothy J. Yeager, 1999. "Drive to efficiency leaves smallest banks behind," The Regional Economist, Federal Reserve Bank of St. Louis, issue Jul, pages 12-13.
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    Cited by:

    1. Lakshmi Balasubramanyan & Spiro Stefanou & Jeffrey Stokes, 2012. "An entropy approach to size and variance heterogeneity in U.S. commercial banks," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 36(3), pages 728-749, July.

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