An applied research on the profit and cost efficiency determinants of domestic commercial banks, 2000-2004

Date of Publication

2006

Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Management of Financial Institutions

Subject Categories

Finance and Financial Management

College

Ramon V. Del Rosario College of Business

Department/Unit

Financial Management

Thesis Adviser

Lawrence T. Co

Defense Panel Member


Clive Manuel O. Wee Sit
Joel N. Bangalan

Abstract/Summary

Efficiency had always been a concern of the commercial banking system in recent years. In line with this, a number of studies had tried to assess banking efficiency, specifically in terms of maximizing profits and/or minimizing costs.

The primary aim of this study was to identify relationships of proven determinants on profit and cost efficiencies of domestic commercial banks for the years 2000 to 2004. To name, such determinants fro profit efficiency employed in the study were bank structure via equity capital and total deposits, market share, and inflation rate. Moreover, non-performing loans and financial capital were the variables used as cost efficiency determinants.

Panel regression technique helped in verifying the theories of prominent finance analysts and economists regarding bank efficiency. Equity capital, market share, and inflation rate indeed promoted profit efficiency, leaving total deposits as the only determinant that had a negative impact over the same. On the other hand, non-performing loans and financial capital decreased cost efficiency, reestablishing the theories previously done. An important note was that the theories used to support the a-priori expectations were verified by the results.

Abstract Format

html

Language

English

Format

Print

Accession Number

TU13564

Shelf Location

Archives, The Learning Commons, 12F, Henry Sy Sr. Hall

Physical Description

3 v. ; 29 cm. + 2 computer optical disc

Keywords

Banks and banking--Philippines; Profit-- Philippines; Cost effectiveness--Philippines; Philippines--Economic conditions--20th century; Allied Banking Corp; Banco de Oro Universal Bank; Bank of Philippine Islands; China Banking Corp; Equitable PCI Bank; Metropolitan Bank & Trust Co; Philippine National Bank; Prudential Bank; Rizal Commercial Banking Corp; Security Bank Corp; Union Bank of the Philippines; United Coconut Planters Bank; Development Bank of the Philippines; Land Bank of the Philippines; Asia United Bank Corp; Bank of Commerce; East West Banking Corp; Export & Industry Bank; Philippine Bank of Communications; Philippine Trust Co; Philippine Veterans Bank

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