Abstract
This study offered an application of a non-parametric analytic technique, namely data envelopment analysis for measuring the performance of the Nepalese commercial banking sector. It explored the efficiency of the Nepalese commercial banks with the use of interest expenses and loan loss provision as inputs and net interest income, commission income and other operating income as outputs for the period of 2005–2010. It was also observed the effects of scale and of the mode of ownership (public sector, joint venture and domestic private sector) on bank behavior and therefore, on bank performance in the Nepalese banking industry. The public sector banks most recently in the analyzed period were observed to perform relatively more efficient than joint venture banks and domestic private banks with respect to their profit efficiency due to the large scale of branch networks.
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Acknowledgments
The authors would like to thank the National Science Foundation of China (71173060, 70773028 and 71031003) for their supports.
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Jha, S., Hui, X., Sun, B. (2013). Evaluating the Profit Efficiency of Commercial Banks: Empirical Evidence from Nepal. In: Lin, YK., Tsao, YC., Lin, SW. (eds) Proceedings of the Institute of Industrial Engineers Asian Conference 2013. Springer, Singapore. https://doi.org/10.1007/978-981-4451-98-7_178
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DOI: https://doi.org/10.1007/978-981-4451-98-7_178
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