Bank efficiency in emerging Asian countries

The paper examines the relationships between market concentration, bank competition and X-efficiency in banking across six emerging Asian countries—Bangladesh, India, Indonesia, Malaysia, the Philippines and Vietnam—over the period 2005–12. Market concentration has a positive effect on X-efficiency, whereas competition has a negative effect on X-efficiency. Moreover, bank size and gross domestic product growth have positive influences on X-efficiency whereas liquidity risk is negatively related to X-efficiency. In addition, the study has important policy implications for governments and banks with respect to increasing X-efficiency of banking.