Revenue Efficiency in European Banking
Revenue Efficiency in European Banking

Author(s): Kristína Kočišová
Subject(s): Business Economy / Management, Methodology and research technology, Financial Markets, Accounting - Business Administration
Published by: Masarykova univerzita nakladatelství
Keywords: banking sector; revenue efficiency; DEA;
Summary/Abstract: This paper analyses revenue efficiency of banking sectors in the European Union countries over the period 2008-2014. The Data Envelopment Analysis (DEA) method is applied. The results show decrease of the average revenue efficiency in the whole sample. The results of DEA analysis, by country, indicate that the efficiency ranged from 52.47% in case of Romania to 100% in case of Germany, United Kingdom, Netherlands, Sweden, Malta, and Luxembourg. The revenue efficiency was also analyzed in three groups of banking sectors, classified according to the volume of total assets. Large banking sectors seem to be most efficient, where the average revenue efficiency during the whole analyzed period was 97.11%. On the second place, there were banking sectors within the medium-sized group (85.3%) and the least efficient were banking sectors in the small sized group (71.6%). In the last part of our analysis there were determined four main European “regions” and the average revenue efficiency was analyzed within them. According to the results of analysis, levels of efficiency in case of Northern (89.4%) and Western European (89.5%) banking sectors were higher than the average in the whole sample (79.8%); on the other hand, the average revenue efficiencies in case of Southern (76.7%) and Eastern European (63.5%) banking sectors were under the total average.

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