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Determinants of bank technical efficiency: A South African study
The purpose of this study is to investigate the determinants of technical efficiency, using data envelopment analysis and the Tobit regression model, of the six largest listed South African banks for the years 2008-2018. An input-oriented intermediary constant-return-to-scale approach was followed t...
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| Format: | Thesis |
| Language: | English |
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Department of Finance and Tax
2021
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| _version_ | 1867613363872202752 |
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| access_status_str | Open Access |
| author | Abels, Jared |
| author2 | Chamisa, Edward |
| author_browse | Abels, Jared Chamisa, Edward |
| author_facet | Chamisa, Edward Abels, Jared |
| author_sort | Abels, Jared |
| collection | Thesis |
| description | The purpose of this study is to investigate the determinants of technical efficiency, using data envelopment analysis and the Tobit regression model, of the six largest listed South African banks for the years 2008-2018. An input-oriented intermediary constant-return-to-scale approach was followed to determine technical efficiency scores. After technical efficiency scores were obtained, a binary data set was created by assigning a score of 1 to all observations that were regarded as technical efficient, whereas all observations that were regarded as technically inefficient were assigned a score of 0. Thereafter, a Tobit regression analysis was performed to test the following hypotheses: skimping hypothesis, diversification hypothesis, bad management hypothesis and the funding hypothesis. The results of the regression analysis show that the skimping, diversification, and bad management hypotheses were not relevant for the six largest South African banks over the period under review. Regression results pointed towards the funding hypothesis being applicable to the six largest listed banks over the review period. It can therefore be suggested that the banks under review were generally well managed with a keen focus on expense control and thorough underwriting. To ensure the efficiency of large listed banks, it is proposed that regulators continue to monitor large banks as evidence of the study suggests that as deposit bases grow, a deterioration in technical efficiency is experienced. Generally, the results of the study indicate that the six large listed banks are overall relatively efficient over the review period. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/33619 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:34:58.102Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2021 |
| publishDateRange | 2021 |
| publishDateSort | 2021 |
| publisher | Department of Finance and Tax |
| publisherStr | Department of Finance and Tax |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/33619 Determinants of bank technical efficiency: A South African study Abels, Jared Chamisa, Edward Financial and Risk Management The purpose of this study is to investigate the determinants of technical efficiency, using data envelopment analysis and the Tobit regression model, of the six largest listed South African banks for the years 2008-2018. An input-oriented intermediary constant-return-to-scale approach was followed to determine technical efficiency scores. After technical efficiency scores were obtained, a binary data set was created by assigning a score of 1 to all observations that were regarded as technical efficient, whereas all observations that were regarded as technically inefficient were assigned a score of 0. Thereafter, a Tobit regression analysis was performed to test the following hypotheses: skimping hypothesis, diversification hypothesis, bad management hypothesis and the funding hypothesis. The results of the regression analysis show that the skimping, diversification, and bad management hypotheses were not relevant for the six largest South African banks over the period under review. Regression results pointed towards the funding hypothesis being applicable to the six largest listed banks over the review period. It can therefore be suggested that the banks under review were generally well managed with a keen focus on expense control and thorough underwriting. To ensure the efficiency of large listed banks, it is proposed that regulators continue to monitor large banks as evidence of the study suggests that as deposit bases grow, a deterioration in technical efficiency is experienced. Generally, the results of the study indicate that the six large listed banks are overall relatively efficient over the review period. 2021-07-13T10:51:41Z 2021-07-13T10:51:41Z 2021 2021-07-13T10:37:39Z Master Thesis Masters MCom http://hdl.handle.net/11427/33619 eng application/pdf Department of Finance and Tax Faculty of Commerce |
| spellingShingle | Financial and Risk Management Abels, Jared Determinants of bank technical efficiency: A South African study |
| thesis_degree_str | Master's |
| title | Determinants of bank technical efficiency: A South African study |
| title_full | Determinants of bank technical efficiency: A South African study |
| title_fullStr | Determinants of bank technical efficiency: A South African study |
| title_full_unstemmed | Determinants of bank technical efficiency: A South African study |
| title_short | Determinants of bank technical efficiency: A South African study |
| title_sort | determinants of bank technical efficiency a south african study |
| topic | Financial and Risk Management |
| url | http://hdl.handle.net/11427/33619 |
| work_keys_str_mv | AT abelsjared determinantsofbanktechnicalefficiencyasouthafricanstudy |