Determinants Of Cost Efficiency In Malaysian Banking
This study estimates the cost efficiency and its decompositions of Malaysian banks over the period of 1995 to 2010 by utilising data envelopment analysis (DEA) method. Instead of estimating efficiency based on DEA separate frontiers approach; this study departs from practice of many previous stud...
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| Format: | Article |
| Language: | English |
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Universiti Malaysia Sarawak, (UNIMAS)
2012
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| Online Access: | http://ir.unimas.my/id/eprint/9221/ http://ir.unimas.my/id/eprint/9221/1/DETERMINANTS%20OF%20COST%20EFFICIENCY%20IN%20MALAYSIAN%20BANKING%20%28abstract%29.pdf |
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| author | Rossazana Ab-Rahim, Ab-Rahim Nor Ghani, Md. Nor Shamsubaridah, Ramlee Nur Zaimah, Ubaidillah |
| author_facet | Rossazana Ab-Rahim, Ab-Rahim Nor Ghani, Md. Nor Shamsubaridah, Ramlee Nur Zaimah, Ubaidillah |
| author_sort | Rossazana Ab-Rahim, Ab-Rahim |
| building | UNIMAS Institutional Repository |
| collection | Online Access |
| description | This study estimates the cost efficiency and its decompositions of Malaysian banks over the
period of 1995 to 2010 by utilising data envelopment analysis (DEA) method. Instead of
estimating efficiency based on DEA separate frontiers approach; this study departs from
practice of many previous studies by pooling the data set to build a DEA common frontier.
This study contributes to the existing literature by integrating determinants of banking
efficiency into the areas of DEA methodology in the context of Malaysian banking system
across individual domestic banks. The first objective of this study is to estimate cost efficiency
and its decompositions, which are technical and allocative efficiency as well as to estimate
sources of technical efficiency namely pure technical efficiency and scale efficiency. Next,
Tobit regression analysis is undertaken to identify the determinants of various measures of
banking efficiency. The results indicate that government ownership, population density, demand
density and market concentration are positively associated with several measures of efficiency
while year that merger takes place, macroeconomic condition, capitalization, credit risk, asset
quality and management quality have a negative relationship with various measures of
efficiency. However, the size of banks is found to have mixed sign, positive coefficient with
technical and pure technical efficiency while the negative relationship with scale efficiency,
cost and allocative efficiency. |
| first_indexed | 2025-11-15T06:24:58Z |
| format | Article |
| id | unimas-9221 |
| institution | Universiti Malaysia Sarawak |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-15T06:24:58Z |
| publishDate | 2012 |
| publisher | Universiti Malaysia Sarawak, (UNIMAS) |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | unimas-92212019-05-06T02:18:13Z http://ir.unimas.my/id/eprint/9221/ Determinants Of Cost Efficiency In Malaysian Banking Rossazana Ab-Rahim, Ab-Rahim Nor Ghani, Md. Nor Shamsubaridah, Ramlee Nur Zaimah, Ubaidillah HG Finance This study estimates the cost efficiency and its decompositions of Malaysian banks over the period of 1995 to 2010 by utilising data envelopment analysis (DEA) method. Instead of estimating efficiency based on DEA separate frontiers approach; this study departs from practice of many previous studies by pooling the data set to build a DEA common frontier. This study contributes to the existing literature by integrating determinants of banking efficiency into the areas of DEA methodology in the context of Malaysian banking system across individual domestic banks. The first objective of this study is to estimate cost efficiency and its decompositions, which are technical and allocative efficiency as well as to estimate sources of technical efficiency namely pure technical efficiency and scale efficiency. Next, Tobit regression analysis is undertaken to identify the determinants of various measures of banking efficiency. The results indicate that government ownership, population density, demand density and market concentration are positively associated with several measures of efficiency while year that merger takes place, macroeconomic condition, capitalization, credit risk, asset quality and management quality have a negative relationship with various measures of efficiency. However, the size of banks is found to have mixed sign, positive coefficient with technical and pure technical efficiency while the negative relationship with scale efficiency, cost and allocative efficiency. Universiti Malaysia Sarawak, (UNIMAS) 2012 Article NonPeerReviewed text en http://ir.unimas.my/id/eprint/9221/1/DETERMINANTS%20OF%20COST%20EFFICIENCY%20IN%20MALAYSIAN%20BANKING%20%28abstract%29.pdf Rossazana Ab-Rahim, Ab-Rahim and Nor Ghani, Md. Nor and Shamsubaridah, Ramlee and Nur Zaimah, Ubaidillah (2012) Determinants Of Cost Efficiency In Malaysian Banking. International Journal of Business and Society, 13 (3). pp. 355-374. ISSN 1511-6670 http://www.ijbs.unimas.my/most-popular/item/195-determinants-of-cost-efficiency-in-malaysian-banking.html |
| spellingShingle | HG Finance Rossazana Ab-Rahim, Ab-Rahim Nor Ghani, Md. Nor Shamsubaridah, Ramlee Nur Zaimah, Ubaidillah Determinants Of Cost Efficiency In Malaysian Banking |
| title | Determinants Of Cost Efficiency In Malaysian Banking |
| title_full | Determinants Of Cost Efficiency In Malaysian Banking |
| title_fullStr | Determinants Of Cost Efficiency In Malaysian Banking |
| title_full_unstemmed | Determinants Of Cost Efficiency In Malaysian Banking |
| title_short | Determinants Of Cost Efficiency In Malaysian Banking |
| title_sort | determinants of cost efficiency in malaysian banking |
| topic | HG Finance |
| url | http://ir.unimas.my/id/eprint/9221/ http://ir.unimas.my/id/eprint/9221/ http://ir.unimas.my/id/eprint/9221/1/DETERMINANTS%20OF%20COST%20EFFICIENCY%20IN%20MALAYSIAN%20BANKING%20%28abstract%29.pdf |