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Banking Efficiency in Kosovo during the Global Financial Crisis

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  • Jeton Zogjani
  • Malësor Kelmendi

Abstract

In this research paper is analyzed the impact of banking efficiency on banking sector during of global financial crisis 2008 - 2010 with special focus Kosovo and as the main arguments for discussions are as following: overall banking efficiency in Kosovo, difference between loan and deposit rates in banking sector and difference in efficiency among banks with domestic and foreign investment. In methodology, the data collections are from financial and banking institutions in Kosovo and they are used and calculated through STATA program. The two main analyses are: DEA model (CRS and CRS model for efficiency) and regression methods (OLS method of regression and correlation matrix). The result of DEA analysis indicate that there is a constant increase of efficiency from 0.795 (CRS & VRS) in 2008 to 0.832 (CRS) and 0.913 (VRS) in 2010. The OLS method shows results as following: all variables that are involved in the research (non - performing loans -9.9, interest rate of loans -5.2 and ROA -14.7) have negative impact on banking sector. Also in T-statistics analysis argue that all variables are non-significant (T

Suggested Citation

  • Jeton Zogjani & Malësor Kelmendi, 2015. "Banking Efficiency in Kosovo during the Global Financial Crisis," Academic Journal of Interdisciplinary Studies, Richtmann Publishing Ltd, vol. 4, July.
    • Handle: RePEc:bjz:ajisjr:1149
    DOI: 10.5901/ajis.2015.v4n2p367
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    References listed on IDEAS

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    3. Mullineaux, Donald J, 1978. "Economies of Scale and Organizational Efficiency in Banking: A Profit-Function Approach," Journal of Finance, American Finance Association, vol. 33(1), pages 259-280, March.
    4. Kiril Tochkov & Nikolay Nenovsk, 2010. "Institutional Reforms, EU Accession, and Bank Efficiency: Evidence from Bulgaria," Working Papers 201005, Texas Christian University, Department of Economics.
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