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Int. J. Financial Stud. 2018, 6(3), 66; https://doi.org/10.3390/ijfs6030066

Technical Efficiency of Banks in Central and Eastern Europe

1
Faculty of National Economy, University of Economics in Bratislava, 852 35 Bratislava, Slovakia
2
Faculty of Business Administration, Masaryk University Brno, 601 77 Brno, Czech Republic
Received: 8 May 2018 / Revised: 2 July 2018 / Accepted: 3 July 2018 / Published: 17 July 2018
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Abstract

The purpose of this article is to examine what affected the technical efficiency of banks in Central and Eastern European countries during the financial crisis. Firstly, this article analyzes the technical efficiency of banks in the selected countries in Central and Eastern Europe during the period 2006–2013. In this article, the technical efficiency of Central and Eastern European banks is explored in respect to the size of the banks (large or small) and their belonging in a specific group of countries. The results of the analysis show a strong association between the numbers of efficient banks and belonging of banks in the group of V4 countries (Visegrad countries are the Czech Republic, Hungary, Poland, and Slovakia). The banks in Balkan countries have a negative association with the number of efficient banks in the group; the banks in this group of countries have the highest average efficiency (when the output was net interest margin). There is a weak association between the number of efficient banks and their belonging in the group of Baltic countries. The bank efficiency and the size of the bank’s assets are also weakly associated. Secondly, the results of panel regression models for the specific groups of countries (V4, Baltic, and Balkan countries), as well as for the whole group of Central and Eastern European countries show that the customer deposits had a positive impact on the technical efficiency of banks during the financial crisis. View Full-Text
Keywords: technical efficiency; data envelopment analysis; banks in Eastern Europe technical efficiency; data envelopment analysis; banks in Eastern Europe
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Horvatova, E. Technical Efficiency of Banks in Central and Eastern Europe. Int. J. Financial Stud. 2018, 6, 66.

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