The Efficiency of Non-Bank Financial Intermediaries: Empirical Evidence from Malaysia

Authors

  • Fadzlan Sufian The University of Malaysia and CIMB Bank Berhad

Keywords:

Non-Bank financial intermediaries, Data Envelopment Analysis (DEA), Risk

Abstract

This paper investigates the performance of Malaysian non-bank financial institutions during the period of 2000-2004. Several efficiency estimates of individual NBFIs are evaluated using the non-parametric Data Envelopment Analysis (DEA) method. The findings suggest that during the period of study, scale inefficiency outweighs pure technical inefficiency in the Malaysian NBFI sector. We find that the merchant banks have exhibited a higher, technical efficiency compared to their peers. The empirical findings suggest that scale efficiency tends to be more sensitive to the exclusion of risk factors, implying that potential economies of scale may be overestimated when risk factors are excluded.

 

Additional Files

Published

18-08-2008

How to Cite

Sufian, F. (2008). The Efficiency of Non-Bank Financial Intermediaries: Empirical Evidence from Malaysia. International Journal of Banking and Finance, 5(2), 149–167. Retrieved from https://e-journal.uum.edu.my/index.php/ijbf/article/view/8373