The technical efficiency of the Japanese banks: Non-radial directional performance measurement with undesirable output
Sep 21, 2012
Articles in journals
Barros, C., Managi, S., Matousek, R.
This paper analyses technical efficiency of japanese banks from 200-2007. The estimation technique is based on the Russel directional distance function that takes into consideration not only disarable outputs but also na undesirable output that is represented by non-performing loans (NPLs). The results indicate that NPLs remain a significant burden as for bank's performance. We show that banks inouts have to be utilized more efficiently, particularly labour and premises. We also argue that further restructing process is needed in the segment of regional banks. we conclude that the japanese banking system is still far away from being fully consolidated and restructed.