branches.PDF

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branches.PDF

African Journal of Business Management Vol. 5(3), pp. 889-901, 4 February, 2011 Available online at /AJBM DOI: 10.5897/AJBM10.584 ISSN 1993-8233 ©2011 Academic Journals Full Length Research Paper Measuring bank branch performance using Data Envelopment Analysis (DEA): The case of Turkish bank branches 1 2 Mehmet Hasan Eken and Suleyman Kale 1Finance and Banking PhD Programme, Institute of Social Sciences, Kadir Has University, Istanbul, Turkey. 2T.C. Ziraat Bank, Sirinevler Branch, Istanbul, Turkey. Accepted 15 November, 2010 The aim of this study is to develop a performance model for measuring the relative efficiency and potential improvement capabilities of bank branches by identifying their strengths and weaknesses. Another purpose is to investigate the production and profitability aspects of branches. Under both production and profitability approaches, efficiency characteristics of branches, which are grouped according to different sizes and regions, have similar tendencies. In both analyses, it is apparent that branch size and scale efficiency are related to each other. As branch size increases scale efficiency increases too and after the most productive scale size, however, as size increases efficiency decreases. Too small and too large branches need special attention. Putting production and profit efficiency scores on two scales reveals the performing characteristics of branches. Each region needs different handling. Branches with

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