oa Journal of Economic and Financial Sciences - A fundamental evaluation of the top five South African banks after the financial crisis
|Article Title||A fundamental evaluation of the top five South African banks after the financial crisis|
|© Publisher:||University of Johannesburg|
|Journal||Journal of Economic and Financial Sciences|
|Affiliations||1 North West University and 2 North West University|
|Publication Date||Oct 2013|
|Pages||729 - 760|
|Keyword(s)||DEA, Fundamental analysis, Scale efficiency and Technical efficiency|
A significant correlation exists between financial crises and bank liquidity problems, thus exposing the investor to increased risk where the banking industry forms part of their investment portfolios. Also, due to more volatile markets and more complex financing banking activities, the general notion of evaluating only share price trends to determine future investment prospects can become misleading. This paper, therefore, focuses on a multi-stage Data Envelopment Analysis (DEA) model as a complementary share performance tool to the traditional set of fundamental factors. When combining the results from the DEA model and a set of traditional financial measures, Nedbank and FirstRand were found to be the more sensible investment choices for the period under investigation.
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