The Impact of Bank Efficiency on Share Performance:Evidence from Taiwan by Using Data Envelopment Analysis

• Main Authors: Hsiao-wen Chang, 張曉玟
• Other Authors: Ai-chi Hsu
• Format: Others
• Language: zh-TW
• Published: 2012
• Online Access: http://ndltd.ncl.edu.tw/handle/66048227969152551151

碩士 === 國立雲林科技大學 === 財務金融系碩士班 === 100 === The competition among Taiwanese Banks has become more intense since Financial Holding Company Act is enforced in 2001.How to increase operating efficiency and how to respond the pressure of elevating share return from stockholders has been an important issue to bank managers. Therefore, the investigation of the determinants of bank operating efficiency and their relationship with share return has become increasingly important. The study utilizes Data Envelopment Analysis (DEA) and Pearson correlation to investigate the relationship between operating efficiency and share return among 23 Banks in Taiwan, which are listed or OTC companies in the Taiwan stock exchange. Otherwise, this study also probes the inefficient factors and analyzes the influence in share return with different input or output variables in DEA. In the measurement of global technical efficiency, from 2008 to 2010, the average technical efficiency scores in each year was 0.870, 0.882 and 0.896. Although operating efficiency didn’t reach the field of optimal efficient, the score is improving year by year. In the analysis of return to scales, 59.4 percent of banks are constructed under fittest scale. Meanwhile, 30.4 percent of banks are increasing returns to scale and 10.2 percent are decreasing returns to scale. The cause of inefficiency seems to be the scale. The investigation of relationship between DEA and share return, using frequently used variables like loans, non-interest income, and investment as output variables, shows low relationship between each other. However, the relationship becomes higher when replacing output variable with profit. In conclusion, the selection of input or output variables in DEA would influence its relationship with share return. The relationship between share return and profit is higher than that between share return and operating efficiency.