Evaluation of Chinese commercial bank efficiency and influencing factors: a three-stage dynamic data envelopment analysis approach

Efficiency analysis is essential for commercial banks to predict future development and increase their competitiveness. Using a three-stage dynamic data envelopment analysis model within slacks-based measure, this study uses the panel data of representative commercial banks in the Chinese market from 2012 to 2020 to analyze the efficiency of commercial banks and the influencing factors. The efficiency is assessed by integrating deposit, lending, and profit stages. The purpose is to evaluate the effectiveness with which banks utilize their resources to generate outputs and provide financial services. It aims to assess the efficiency of banks in converting inputs such as capital, labor, and technology into desirable outputs such as loans, deposits, and profitability. We have four main findings. (1) State-owned commercial banks (SOBs) perform worse than joint-stock commercial banks (JOBs) in overall efficiency. (2) For period efficiency, SOBs perform better at the deposit stage while JSBs perform better at the profit stage. The performance for the lending stage between SOBs and JSBs is similar. (3) During the 2019–2020 there is fluctuation in commercial bank efficiency in different types of banks and different stages. (4) The influencing factors have a different impact on the efficiency of commercial banks at the three stages. Overall, this study provides insights into the efficiency improvement in the banking industry and also integrate CSR into commercial banking efficiency analysis.