IDEAS home Printed from https://ideas.repec.org/a/col/000129/017380.html
   My bibliography  Save this article

Bank branches efficiency under management and regulatory constraints

Author

Listed:
  • Gustavo Ferro
  • Daniel Lema
  • Francisco Schiffrer

Abstract

The main purpose of this paper is to assess the cost-efficiency of Banco Ciudad de Buenos Aires’s bank branches using a Stochastic Frontier Analysis (SFA). Owing to the results, management can decide on a new branching dimension. Also, if some regulatory or managerial limits could be lifted, such as the closure or opening of new branches without central bank authorization, or redundancy staff reduction, the results could be important for management. We identify best and worst behaved branches. The more cost-efficient branches and the least costefficient ones differ in their size and input mix. Nonetheless, they present a similar output mix

Suggested Citation

  • Gustavo Ferro & Daniel Lema & Francisco Schiffrer, 2019. "Bank branches efficiency under management and regulatory constraints," Estudios Gerenciales, Universidad Icesi, vol. 35(151), pages 122-134, June.
    • Handle: RePEc:col:000129:017380
    as

    Download full text from publisher

    File URL: https://www.icesi.edu.co/revistas/index.php/estudios_gerenciales/article/view/3133
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Berger, Allen N. & Leusner, John H. & Mingo, John J., 1997. "The efficiency of bank branches," Journal of Monetary Economics, Elsevier, vol. 40(1), pages 141-162, September.
    2. Joseph P. Hughes & Loretta J. Mester, 2008. "Efficiency in banking: theory, practice, and evidence," Working Papers 08-1, Federal Reserve Bank of Philadelphia.
    3. Antreas D. Athanassopoulos & Dimitris Giokas, 2000. "The Use of Data Envelopment Analysis in Banking Institutions: Evidence from the Commercial Bank of Greece," Interfaces, INFORMS, vol. 30(2), pages 81-95, April.
    4. A S Camanho & R G Dyson, 1999. "Efficiency, size, benchmarks and targets for bank branches: an application of data envelopment analysis," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 50(9), pages 903-915, September.
    5. Jeffrey Kantor & Shlomo Maital, 1999. "Measuring Efficiency by Product Group: Integrating DEA with Activity-Based Accounting in a Large Mideast Bank," Interfaces, INFORMS, vol. 29(3), pages 27-36, June.
    6. Asimakopoulos, Grigorios & Chortareas, Georgios & Xanthopoulos, Michail, 2018. "The eurozone financial crisis and bank efficiency asymmetries: Peripheral versus core economies," The Journal of Economic Asymmetries, Elsevier, vol. 18(C), pages 1-1.
    7. Tim Coelli & Sergio Perelman & Elliot Romano, 1999. "Accounting for Environmental Influences in Stochastic Frontier Models: With Application to International Airlines," Journal of Productivity Analysis, Springer, vol. 11(3), pages 251-273, June.
    8. G.S. Donatos & D.I. Giokas, 2008. "Relative Efficiency in the branch network of a Greek bank: A quantitative analysis," European Research Studies Journal, European Research Studies Journal, vol. 0(3), pages 53-72.
    9. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-332.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. G.S. Donatos & D.I. Giokas, 2008. "Relative Efficiency in the branch network of a Greek bank: A quantitative analysis," European Research Studies Journal, European Research Studies Journal, vol. 0(3), pages 53-72.
    2. Jesús Pastor & C. Lovell & Henry Tulkens, 2006. "Evaluating the financial performance of bank branches," Annals of Operations Research, Springer, vol. 145(1), pages 321-337, July.
    3. Kerstens, Kristiaan & Bouye, Ahmed Moulaye Hachem & Van de Woestyne, Ignace & Vestergaard, Niels, 2008. "Optimal capacity utilization and reallocation in a German bank branch network: Exploring some strategic scenarios," Working Papers 2008/59, Hogeschool-Universiteit Brussel, Faculteit Economie en Management.
    4. Idaira Cabrera‐Suárez & Jorge V. Pérez‐Rodríguez, 2021. "Bank branch performance and cost efficiency: A stochastic frontier panel data approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 5850-5863, October.
    5. Giokas, Dimitris I., 2008. "Assessing the efficiency in operations of a large Greek bank branch network adopting different economic behaviors," Economic Modelling, Elsevier, vol. 25(3), pages 559-574, May.
    6. Paradi, Joseph C. & Schaffnit, Claire, 2004. "Commercial branch performance evaluation and results communication in a Canadian bank--a DEA application," European Journal of Operational Research, Elsevier, vol. 156(3), pages 719-735, August.
    7. Mai, Nhat Chi, 2015. "Efficiency of the banking system in Vietnam under financial liberalization," OSF Preprints qsf6d, Center for Open Science.
    8. Mohanty, Sunil K. & Lin, Winston T. & Lin, Hong-Jen, 2013. "Measuring cost efficiency in presence of heteroskedasticity: The case of the banking industry in Taiwan," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 26(C), pages 77-90.
    9. Portela, Maria Conceicao A. Silva & Thanassoulis, Emmanuel, 2007. "Comparative efficiency analysis of Portuguese bank branches," European Journal of Operational Research, Elsevier, vol. 177(2), pages 1275-1288, March.
    10. Paradi, Joseph C. & Zhu, Haiyan, 2013. "A survey on bank branch efficiency and performance research with data envelopment analysis," Omega, Elsevier, vol. 41(1), pages 61-79.
    11. A S Camanho & R G Dyson, 2005. "Cost efficiency, production and value-added models in the analysis of bank branch performance," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 56(5), pages 483-494, May.
    12. Dejene Mamo Bekana (MBA) & Asres Abitie (MBA), 2012. "Evaluation Of Financial Performance Of Banking Enterprises; The Case Of Construction And Business Bank Of Ethiopia," Revista Tinerilor Economisti (The Young Economists Journal), University of Craiova, Faculty of Economics and Business Administration, vol. 1(18), pages 82-102, April.
    13. Franz R. Hahn, 2007. "Determinants of Bank Efficiency in Europe. Assessing Bank Performance Across Markets," WIFO Studies, WIFO, number 31499, January.
    14. Williams, Jonathan, 2004. "Determining management behaviour in European banking," Journal of Banking & Finance, Elsevier, vol. 28(10), pages 2427-2460, October.
    15. Fethi, Meryem Duygun & Pasiouras, Fotios, 2010. "Assessing bank efficiency and performance with operational research and artificial intelligence techniques: A survey," European Journal of Operational Research, Elsevier, vol. 204(2), pages 189-198, July.
    16. Jean Pierre Huiban & Camille Mastromarco & Antonio Musolesi & Michel Simioni, 2016. "The impact of pollution abatement investments on production technology: new insights from frontier analysis," Working Papers hal-01512154, HAL.
    17. Karim L. Anaya & Michael G. Pollitt, 2014. "Does Weather Have an Impact on Electricity Distribution Efficiency? Evidence from South America," Working Papers EPRG 1404, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    18. Raulin Lincifort Cadet, 2015. "Cost and profit efficiency of banks in Haiti: do domestic banks perform better than foreign banks?," International Journal of Banking, Accounting and Finance, Inderscience Enterprises Ltd, vol. 6(1), pages 37-52.
    19. William R. Pratt & Gustavo A. Barboza & Matthew Brigida, 2023. "Leverage and firm value," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 52(2), July.
    20. Christopoulos, Dimitris K. & McAdam, Peter, 2019. "Efficiency, Inefficiency, And The Mena Frontier," Macroeconomic Dynamics, Cambridge University Press, vol. 23(2), pages 489-521, March.

    More about this item

    Keywords

    efficiency frontiers; banking branches: banking managemen;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:col:000129:017380. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Coordinador ICESI (email available below). General contact details of provider: https://edirc.repec.org/data/fciceco.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.