Empirical study on efficiency of Singaporean banks

• Main Authors: Lim, Gim Hoe, Yang, Camillus, Cheong, Belinda
• Other Authors: Tan, Khee Giap
• Format: Final Year Project
• Published: 2008
• Subjects: DRNTU::Business::Finance::Banking
• Online Access: http://hdl.handle.net/10356/8276
• Institution: Nanyang Technological University

With trends rapidly moving towards globalisation and e-commerce, the traditional brick-and-mortar banking industries have no choice but to undergo a revolutionary phase. Singapore's domestic banking industry, likeher regional counterparts, has also been swept into the race for greater integration and better operational efficiency. Local banks must realise the importance of using bank efficiency rather than bank profitability forthe determination of strategic directions and long-term performance. In fact, they have been urged by the Monetary Authority of Singapore (MAS) to shape up or risk being shaken out of the race. In our study, a stochasticfrontier analysis and the translog cost function was used to investigate the efficiency of five local banks with a pooled-data sample from 1991 to 1998. The five local banks in our scope consist of the Development Bank of Singapore (DBS), Keppel TatLee Bank (KTL), Overseas Chinese BankingCorporation (OCBC), Overseas Union Bank (OUB) and United Overseas Bank (UOB