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A Two-Stage DEA Model to Evaluate the Performance of Iberian Banks

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Listed:
  • Victor Moutinho

    (NECE-Research Center in Business Sciences and Management and Economics Department, 6201-001 Covilhã, Portugal
    Management and Economics Department, University of Beira Interior, 6201-001 Covilhã, Portugal)

  • José Vale

    (CEOS.PP—Centre for Organisational and Social Studies of P. Porto, Porto Accounting and Business School, Polytechnic Institute of Porto, 4465-004 Porto, Portugal)

  • Rui Bertuzi

    (CEOS.PP—Centre for Organisational and Social Studies of P. Porto, Porto Accounting and Business School, Polytechnic Institute of Porto, 4465-004 Porto, Portugal)

  • Ana Maria Bandeira

    (CEOS.PP—Centre for Organisational and Social Studies of P. Porto, Porto Accounting and Business School, Polytechnic Institute of Porto, 4465-004 Porto, Portugal)

  • José Palhares

    (DEGEIT—Department of Economics, Management, Industrial Engineering and Tourism, University of Aveiro, 3810-193 Aveiro, Portugal)

Abstract

This paper’s goal is twofold: it aims to assess the performance of 58 Iberian banks and explore the relationship between such performance and the banks’ Intellectual Capital (IC) efficiency during a post-crisis period. As long as the authors are aware, there is a gap in the literature in exploring the relationship between banks’ global performance and IC efficiency. First, the Data Envelopment Analysis model was adopted to measure the efficiency of Iberian banks and rank them according to their performance. Data were collected digitally, specifically by using the Bankscope database provided by Bureau van Dijk. Results show that by improving their resources management practices, banks can significantly increase their efficiency. Then, fractional regressions were used to infer the relationship between IC’s efficiency and the scores obtained in the first stage. Results suggest that Iberian banks’ global performance is mainly determined by their human capital efficiency. Finally, this study stresses the importance of IC measurement to support more efficient decision-making by bank managers.

Suggested Citation

  • Victor Moutinho & José Vale & Rui Bertuzi & Ana Maria Bandeira & José Palhares, 2021. "A Two-Stage DEA Model to Evaluate the Performance of Iberian Banks," Economies, MDPI, vol. 9(3), pages 1-22, August.
    • Handle: RePEc:gam:jecomi:v:9:y:2021:i:3:p:115-:d:615771
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    References listed on IDEAS

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    5. Chen, Zhongfei & Matousek, Roman & Wanke, Peter, 2018. "Chinese bank efficiency during the global financial crisis: A combined approach using satisficing DEA and Support Vector Machines☆," The North American Journal of Economics and Finance, Elsevier, vol. 43(C), pages 71-86.
    6. Aggelopoulos, Eleftherios & Georgopoulos, Antonios, 2017. "Bank branch efficiency under environmental change: A bootstrap DEA on monthly profit and loss accounting statements of Greek retail branches," European Journal of Operational Research, Elsevier, vol. 261(3), pages 1170-1188.
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    2. Shakeb Akhtar & Mahfooz Alam & Aslam Khan & Mohd Shamshad, 2023. "Measuring technical efficiency of banks vis-à-vis demonetization: an empirical analysis of Indian banking sector using CAMELS framework," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(2), pages 1739-1761, April.

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