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THE IMPACT OF BANK SPECIFIC FACTORS ON THE EFFICIENCY OF PAKISTAN COMMERCIAL BANKS DATA ENVELOPMENT ANALYSIS AND TOBIT REGRESSION MODEL FRAMEWORK

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55 Pages : 600-611

http://dx.doi.org/10.31703/grr.2019(IV-IV).55      10.31703/grr.2019(IV-IV).55      Published : Dec 2019

The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework

Abstract

    This study aims to measure the effects of bank-specific factors on the efficiency of Pakistan's twenty-seven (27) commercial banks. Efficiency was computed by input-oriented data envelopment analysis approach under CRS (constant return to scale) and VRS (variable return to scale) assumptions. The results revealed that overall inefficiency in commercial banks was to tune of 10 percent and was caused by both managerial incompetence and uneconomical bank's size. However, the uneconomic scale size remained the dominant source of inefficiency at individual banks level, and most of the banks exhibited a decreasing return to scale (DRS) behaviour. Furthermore, efficiency scores were regressed by bank-specific factors using the Tobit regression model. Among the bank-specific factors, Profitability, liquidity, bank size had a significant and positive impact, while market share and Asset quality had a negative and substantial effect on all the efficiency parameters.

    ideology, textbooks, critical discourse

    (1) Farhat Ullah Khan
    Assistant Professor, Department of Business Administration, Gomal University, Dera Ismail Khan, KP, Pakistan.
    (2) Aman Ullah Khan
    Assistant Professor, Department of Business Administration, Gomal University, Dera Ismail Khan, KP, Pakistan.
    (3) Inayat Ullah
    PhD Scholar, Department of Public Administration, Gomal University, Dera Ismail Khan, KP, Pakistan.
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Cite this article

APA

    APA : Khan, F. U., Khan, A. U., & Ullah, I. (2019). The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework. Global Regional Review, IV(IV), 600-611. https://doi.org/10.31703/grr.2019(IV-IV).55

CHICAGO

    CHICAGO : Khan, Farhat Ullah, Aman Ullah Khan, and Inayat Ullah. 2019. "The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework." Global Regional Review, IV (IV): 600-611 doi: 10.31703/grr.2019(IV-IV).55

HARVARD

    HARVARD : KHAN, F. U., KHAN, A. U. & ULLAH, I. 2019. The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework. Global Regional Review, IV, 600-611.

MHRA

    MHRA : Khan, Farhat Ullah, Aman Ullah Khan, and Inayat Ullah. 2019. "The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework." Global Regional Review, IV: 600-611

MLA

    MLA : Khan, Farhat Ullah, Aman Ullah Khan, and Inayat Ullah. "The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework." Global Regional Review, IV.IV (2019): 600-611 Print.

OXFORD

    OXFORD : Khan, Farhat Ullah, Khan, Aman Ullah, and Ullah, Inayat (2019), "The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework", Global Regional Review, IV (IV), 600-611

TURABIAN

    TURABIAN : Khan, Farhat Ullah, Aman Ullah Khan, and Inayat Ullah. "The Impact of Bank-Specific Factors on the Efficiency of Pakistan's Commercial Banks: Data Envelopment Analysis and Tobit Regression Model Framework." Global Regional Review IV, no. IV (2019): 600-611. https://doi.org/10.31703/grr.2019(IV-IV).55