Financial Reforms and Banking Efficiency: Case of Pakistan

Ahmad, Usman (2011): Financial Reforms and Banking Efficiency: Case of Pakistan. Forthcoming in:

Abstract

This paper attempts to analyze the performance of the banking sector of Pakistan in the light of second generation reforms on the domestic scheduled banks by using data from 1990 to 2008. For this purpose I used Non Parametric Data Envelopment Analysis (DEA). The analysis revealed an overall improvement in the efficiency of commercial banks. It implies that financial sector reforms, particularly the second phase of reforms, improved the efficiency of the commercial bank in Pakistan. After the reforms, pure technical efficiency increased as compared to scale efficiency and it was found that the overall efficiency of the industry has increased due to pure technical efficiency. The study concludes that the reforms were successful in improving the efficiency of the domestic commercial banks in Pakistan.

• Item Type: MPRA Paper
• Language: English
• Keywords: Efficiency, Banks, DEA, Pakistan
• Subjects: E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E58 - Central Banks and Their Policies; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages

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