Technical Efficiency of Shipping Banks: A DEA Approach

Sambracos, Evangelos and Maniati, Marina (2015): Technical Efficiency of Shipping Banks: A DEA Approach.

Abstract

The international transportation Industry involves various sectors, shipping being one with particular characteristics which differentiates it from others. Within this scope, commercial banks are one of the main entities that may offer the required funding in a market that is characterized by the need for large amounts of capital and high operating costs. Banks play a significant role and are required to assess a number of factors in order to limit the risk from loans as well as to establish an accurate risk-return ratio. The efficiency of banks involved in the shipping industry is particularly important since it may, on one hand, affect financial growth, and on the other, create systemic crisis that may affect the economy as a whole as it directly affects the borrowing and consequently the financial situation and investment activity the shipping companies. This paper presents an effort to assess the shipping banks’ efficiency, and the determination of those factors which affect their technical efficiency, through the application of Data Envelopment Analysis. The results of this research indicate the factors that affect the efficiency of the shipping banks such as ROA, ROE, total loan loss provision to total loans ratio, total deposits and total assets, providing significant information to be considered by management regarding factors on which they should further focus in order to maintain and/or reinforce technical efficiency.

• Item Type: MPRA Paper
• Language: English
• Keywords: Efficiency, shipping banks, DEA, finance, profitability.
• Subjects: C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C14 - Semiparametric and Nonparametric Methods: General; D - Microeconomics > D2 - Production and Organizations > D22 - Firm Behavior: Empirical Analysis; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages

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