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Benchmarking as a Mechanism to Measure Reference Efficiency and Improve the Performance of a Group of Banks in Algeria Using the DEA Data Envelope

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Islamic Finance

Abstract

The study sought to benchmark as a method to study the efficiency of Algerian commercial banks and for the purpose of improving financial performance, which is the criterion for development and creativity under the current circumstances, for Algerian commercial banks (BADR, ELSALAM, SG, BNP_P BNA, BDL), during the period 2017–2021 and to improve their financial performance after being affected by the Corona pandemic, using the DEA data envelope analysis method.

The following results were reached after relying on inputs (capital, deposits) and outputs (loans, investments), where full efficiency was achieved in BDL Bank except for the year 2021 and BADR Bank except for the year 2018 according to the CRS model in the input and output directions. While in the VRS model, SG Bank and ELSALAM achieved full efficiency in the input and output directions over the 5 years studied. Inefficient banks (BNA, BNP_P) are therefore required to improve their financial performance following the example of reference banks.

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Correspondence to Bishr Lutfi .

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© 2024 The Author(s), under exclusive license to Springer Nature Switzerland AG

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Abdelkader, Y., Abdelghani, M., Lutfi, B., Noura, B.B., Meriem, B.H. (2024). Benchmarking as a Mechanism to Measure Reference Efficiency and Improve the Performance of a Group of Banks in Algeria Using the DEA Data Envelope. In: Mansour, N., Bujosa, L. (eds) Islamic Finance. Contributions to Management Science. Springer, Cham. https://doi.org/10.1007/978-3-031-48770-5_16

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