Search

A modified generalised directional distance function data envelopment analysis model is introduced into the smoothed bootstrap context. The new model handles asymmetrically desirable and undesirable outputs and deals with positive and negative values, while the bias-corrected estimators are independent of the length of the direction vector. The reason for the development of this new efficiency assessment model is the estimation of the degree of operating efficiency gains from possible mergers and acquisitions (M&A) between banks. Our estimations are regarded as more realistic compared to those found in the extant literature, as they consider not only desirable but also undesirable variables and negative values that are crucial to the evaluation of firm performance. The new model is not only applicable to the banking sector but also in any industry. We use two data samples, one consisting of 86 conventional and a second consisting of 21 Islamic banks. Among the findings of this study is the convergence of the conventional and Islamic banks' efficiencies over the period 2014–2016. Moreover, consolidations only between efficient and inefficient conventional banks lead to higher operating efficiency, while M&A between efficient only or inefficient only conventional banks and between Islamic banks are likely to be undesirable. [ABSTRACT FROM AUTHOR]

This paper compares the determinants of bank performance between national and foreign commercial banks in UAE. It also compares the relative importance of each determinant on bank performance in the two sets of banks. This paper adopts two regression models. The results indicate that the most significant determinants of the national banks' performance were banks' size and banks' portfolio composition. Variables which had been thought to play a major role, including labor productivity, capitalization, liquidity and economic conditions, were found to be less significant. It is also found that the most significant determinants of the foreign banks' performance were capital productivity, capitalization, leverage, and economic conditions. Variables had less significant impact on foreign banks' performance were banks' portfolio composition, liquidity, concentration and costs. [ABSTRACT FROM PUBLISHER]