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Institutional Reforms, EU Accession, and Bank Efficiency: Evidence from Bulgaria

Listed author(s):
  • Kiril Tochkov

    ()

    (Department of Economics, Texas Christian University)

  • Nikolay Nenovsk

    ()

    (Department of Economics, University of Orleans and ICER)

The paper examines the efficiency of Bulgarian banks and its determinants over the period 1999-2007. The levels of technical, allocative, and cost efficiency are estimated using a non-parametric methodology and then regressed upon a number of bank-specific, institutional, and EU-related factors. The findings indicate that foreign banks were more efficient than domestic private banks, although the gap between them narrowed over time. State-owned banks ranked last but their privatization resulted in efficiency gains. Capitalization, liquidity, and enterprise restructuring enhanced bank efficiency, while banking reforms had an adverse effect. The Treaty of Accession and EU membership were associated with significant efficiency improvements.

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File URL: http://www.econ.tcu.edu/RePEc/tcu/wpaper/wp10-02.pdf
File Function: First version, 2010
Download Restriction: no

Paper provided by Texas Christian University, Department of Economics in its series Working Papers with number 201005.

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Length: 32 pages
Date of creation: Mar 2010
Handle: RePEc:tcu:wpaper:201006
Contact details of provider: Web page: http://www.econ.tcu.edu/

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