n Management Dynamics : Journal of the Southern African Institute for Management Scientists - A model to compare bank size and the performance of banks by using financial statement analyses and Data Envelopment Analysis




This paper employs conventional financial statement analyses as well as Data Envelopment Analysis (DEA),as a non-parametric approach, to carry out a performance evaluation of a bank at regional level. Two approaches to defining bank regional size are also identified. The primary objective of this study is to determine whether there is a relationship between the results of the different performance measures and the size of a bank region. <br>Evidence was found that there is a significant relationship between some of the performance measures and the size of a bank region. In some cases there is a positive relationship between the region size and the performance measure, for example total income to staff cost. In other cases, a negative relationship exists between the region size and the performance measures, as in the case of total income to assets. The study concludes that managers (and not the size of a bank region) determine the performance of a bank region or bank branch.


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