The Relative Efficiency of Commercial Banks in Thailand: DEA Approach

Chansarn, Supachet
August 2008
International Research Journal of Finance & Economics;2008, Issue 18, p53
Academic Journal
This study aims to examine the relative efficiency of Thai commercial banks during 2003 � 2006 by utilizing Data Envelopment Analysis (DEA). Based on the sample of 13 commercial banks, our findings reveal that the efficiency of Thai commercial banks via operation approach is very high and stable while the efficiency via intermediation approach is moderately high and somewhat volatile. In term of size, large, medium and small banks, in average, are efficient via operation approach with the average efficiencies of 100%. However, small banks are the most efficient banks via intermediation approach. In addition, incumbents which are commercial banks originally competing in banking business and new entries which are commercial banks previously competing in finance and securities business are also efficient via operation approach with the average efficiencies of 100%. Nevertheless, incumbents, in average, are more efficient than new entries in perspective of intermediation approach.


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