The technical efficiency of the Japanese banks : non-radial directional performance measurement with undesirable output

Barros, Carlos Pestana, Managi, Shunsuke, & Matousek, Roman (2012) The technical efficiency of the Japanese banks : non-radial directional performance measurement with undesirable output. Omega, 40(1), pp. 1-8.

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Abstract

The paper analyses technical efficiency of the Japanese banks from 2000 to 2007. The estimation technique is based on the Russell directional distance function that takes into consideration not only desirable outputs but also an undesirable output that is represented by non-performing loans (NPLs). The results indicate that NPLs remain a significant burden as for banks' performance. We show that banks' inputs have to be utilised more efficiently, particularly labour and premises. We also argue that a further restructuring process is needed in the segment of Regional Banks. We conclude that the Japanese banking system is still far away from being fully consolidated and restructured.

Impact and interest:

89 citations in Scopus
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75 citations in Web of Science®

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ID Code: 75444
Item Type: Journal Article
Refereed: Yes
Keywords: Banks; DEA; Japan; Non-performing loans
DOI: 10.1016/j.omega.2011.02.005
ISSN: 0305-0483
Subjects: Australian and New Zealand Standard Research Classification > ECONOMICS (140000) > APPLIED ECONOMICS (140200)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Economics & Finance
Copyright Owner: Copyright 2012 Elsevier
Deposited On: 25 Aug 2014 00:41
Last Modified: 25 Aug 2014 23:26

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