An empirical analysis on the bidirectional relationship of cost efficiency to the non-performing loans ratio and non-performing assets ratio of private domestic universal banks in the Philippines from the years 2002 to 2012

Date of Publication

2013

Document Type

Bachelor's Thesis

Degree Name

Bachelor of Science in Management of Financial Institutions

College

Ramon V. Del Rosario College of Business

Department/Unit

Financial Management

Thesis Adviser

Rene Betita

Defense Panel Chair

Lawrence Co

Defense Panel Member

Edgardo Bolinao

Edralin Lim

Abstract/Summary

This paper focuses on testing the bidirectional relationship of cost efficiency and the non-performing loans ratio and non-performing assets ratio of private domestic universal banks in the Philippines from the years 2002 to 2012. In order to achieve this main objective, cost efficiency is estimated using a Stochastic Frontier Approach. The cost efficiency estimates obtained are afterwards used in a Simultaneous-Equation Tobit Model to determine if such relationship exists between cost efficiency, non-performing loans ratio and non-performing assets ratio, while including assets and age as the intervening variables. The results show that cost efficiency has a negative bidirectional relationship with non-performing loans ratio and non-performing assets ratio. The banks assets and age also significantly and negatively affect the 3 major variables.

Abstract Format

html

Language

English

Format

Print

Accession Number

TU17243

Shelf Location

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

Physical Description

vii, 82 leaves :\billustrations (some color) ; 28 cm. + 1 computer disc ; 4 3/4 in.

Keywords

Universal banks--Philippines; Banks and banking--Philippines; Bank assets--Philippines; Bank loans--Philippines

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