Commercial Banks Performance and Causality Analysis. Issue 3 (June 2019)

• Record Type: Journal Article
• Authors: Raina, Dalip; Sharma, Supran Kumar; Bhat, Archana
• Is Part Of: Global business review. Volume 20:Issue 3(2019)
• Page Start: 769
• Page End: 794
• Publication Date: 2019-06
• Subjects: Bank efficiency -- Indian banking -- ownership -- Translog stochastic frontier analysis; Economic history -- 1990- -- Periodicals; Industrial management -- Periodicals; Business -- Periodicals; Commerce -- Periodicals; 650.05
• DOI: 10.1177/0972150919837077
• Languages: English
• ISSNs: 0972-1509

Abstract

The present study estimates technical efficiency (TE) by developing Translog stochastic frontier approach. The study also verifies causal relationship between efficiency and advances using panel Granger causality test. The study experienced an increasing trend in terms of level of efficiency. The public sector banks emerged relatively more efficient than other ownership groups. The study found that priority sector advances to total advances, marker share and non-performing assets to total assets are positively associated while loanable funds to total liabilities is negatively related with technical inefficiency. The study further confirmed the existence of positive and bilateral relationship between advances and TE score.