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Performance assessment of Nigerian banks pre and post consolidation: evidence from a Bayesian approach

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  • A. George Assaf
  • Carlos Barros
  • Ade Ibiwoye

Abstract

This study analyses the cost-efficiency of Nigerian banks pre and post the consolidation period. The researchers account for bank heterogeneity using the Bayesian random frontier model, which in this context provides a better fit than the traditional stochastic frontier model. From the efficiency inferences, it is shown that the cost-efficiency of Nigerian banks has increased post the consolidation period to reach its highest average of 91.21% in 2007. The study discusses the potential impact of consolidation on the efficiency results and provides direction for future research.

Suggested Citation

  • A. George Assaf & Carlos Barros & Ade Ibiwoye, 2010. "Performance assessment of Nigerian banks pre and post consolidation: evidence from a Bayesian approach," The Service Industries Journal, Taylor & Francis Journals, vol. 32(2), pages 215-229, August.
    • Handle: RePEc:taf:servic:v:32:y:2010:i:2:p:215-229
    DOI: 10.1080/02642069.2010.529135
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    References listed on IDEAS

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    1. H.P. Huizinga & J.H.M. Nelissen & R. Vander Vennet, 2001. "Efficiency Effects of Bank Mergers and Acquisitions," Tinbergen Institute Discussion Papers 01-088/3, Tinbergen Institute.
    2. Mr. David Hauner & Mr. Shanaka J Peiris, 2005. "Bank Efficiency and Competition in Low-Income Countries: The Case of Uganda," IMF Working Papers 2005/240, International Monetary Fund.
    3. Balogun, Emmanuel Dele, 2007. "A review of Soludo's perspective of banking sector reforms in Nigeria," MPRA Paper 3803, University Library of Munich, Germany.
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    Citations

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    Cited by:

    1. Barros, Carlos Pestana & Wanke, Peter, 2014. "Banking efficiency in Brazil," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 28(C), pages 54-65.
    2. Wanke, Peter & Barros, Carlos P. & Faria, João R., 2015. "Financial distress drivers in Brazilian banks: A dynamic slacks approach," European Journal of Operational Research, Elsevier, vol. 240(1), pages 258-268.
    3. Carlos P. Barros & Qi Bin Liang & Nicolas Peypoch, 2014. "Technical Efficiency in the Angolan Banking Sector with the B-convexity Model," South African Journal of Economics, Economic Society of South Africa, vol. 82(3), pages 443-454, September.
    4. Barros, C.P. & Emrouznejad, Ali, 2016. "Assessing productive efficiency of banks using integrated Fuzzy-DEA and bootstrapping: A case of Mozambican banksAuthor-Name: Wanke, Peter," European Journal of Operational Research, Elsevier, vol. 249(1), pages 378-389.
    5. Carlos Pestana Barros & Emanuel Reis Leão & Nkanga Pedro João Macanda & Zorro Mendes, 2016. "A Bayesian Efficiency Analysis of Angolan Banks," South African Journal of Economics, Economic Society of South Africa, vol. 84(3), pages 484-498, September.

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