BANKING SECTOR EFFICIENCY: A DATA ENVELOPMENT ANALYSIS
IGBINOBA Newman Osakioya and CHIAMA Paschal Onyeka
Volume 1 Issue 1
Abstract
The study adopted firm two stage specific data envelopment analysis technique to empirically study the performance efficiency of deposit money banks listed in the Nigeria bourse from 2016 to 2018, the data were yearly data from the period covering twelve deposit money banks in Nigeria quoted on the capital market. Findings based on the period under review indicate that resource utilization of Nigeria’s deposit money banks are grossly efficient, since 33% efficiency were obtained under CRS and VRS assumptions, while 42% was SCALE efficient in converting minimal input to maximum output, which is a strong indication that DMBs in Nigeria are efficient in their input to output operation in achieving their primary goal of profit making. The study recommends that the reference point of efficient banks (First bank, GTB, Stanbic IBTC and Unity bank) should be bench marked by the non-efficient banks with regards to their input to output orientation in the financial sector. Keywords: Deposit Money Banks, Efficiency, Data Envelopment Analysis
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