BOFIT Discussion Papers, Institute for Economies in Transition, Bank of Finland
No 1/2010:
Bank cost efficiency in Kazakhstan and Russia
Anatoly Peresetsky ()
Abstract: The Kazakhstan banking system is increasingly viewed as
more advanced than the Russian system. Kazakhstan adopted the International
Accounting System (IAS) in 2003 and the Basel II norms in 2005, while
Russia has yet to fully adopt either IAS or Basel II. In this paper, bank
data for 2002-2006 are used to estimate models of bank cost efficiency. In
contrast to most previous papers, no significance difference is found for
the average cost efficiency scores of banks for the two countries during
2002-2006. How banks are ranked for efficiency depends upon the chosen
model (input and output sets). An interesting insight is the finding that
most banks in both countries are below optimal size.
Keywords: cost efficiency; banks; stochastic frontier approach; (follow links to similar papers)
JEL-Codes: D21; F30; G21; (follow links to similar papers)
29 pages, February 26, 2010
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