CFCM 12/05: The Impact of the Global Financial Crisis on European Banking Efficiency

Abstract

Various measures of efficiency are calculated using the non-parametric data envelopment approach (DEA), for a sample of 255 European Union banks over the period 2005 to 2010. The results clearly indicate a fall in efficiency across the sample during the period analysed. The findings also suggest that the crisis had a differentiated impact across countries and across bank specialisations. Banks from Sweden and Denmark were the most efficient over the sample period, while the banks worst affected by the crisis were from Belgium and Denmark, followed by Ireland and Greece. Additionally, the results indicate that commercial banks were the most heavily affected in comparison to other specialisations.

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Authors

Haider Alzubaidi and Spiros Bougheas

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