The efficiency of participation and conventional banks in turkey: Using data envelopment analysis

Arslan B. G., Ergec E. H.

International Research Journal of Finance and Economics, vol.57, pp.156-168, 2010 (Scopus) identifier

  • Publication Type: Article / Article
  • Volume: 57
  • Publication Date: 2010
  • Journal Name: International Research Journal of Finance and Economics
  • Journal Indexes: Scopus
  • Page Numbers: pp.156-168
  • Keywords: Bank efficiency, Banking system, Interest-free banking, Profit and loss sharing
  • Anadolu University Affiliated: Yes

Abstract

The comparison of performances of participation banks operating through profit and loss sharing (PLS) paradigm with conventional banks is a matter of discussion in international literature. This study analyzes the efficiencies of 26 private conventional banks and 4 participation banks in 2006 and 2009 through the data envelopment analysis (DEA) method. The DEA results reveal that while 3 out of 10 banks, identified inefficient in 2006, were participation banks, in 2009, only 1 out of 11 banks, identified inefficient, was a participation bank. © EuroJournals Publishing, Inc. 2010.