THE EFFECT OF BANKING EXPANSION ON PROFIT EFFICIENCY OF SAUDI BANKS

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Nader Alber ORCID logo

https://doi.org/10.22495/cocv8si1p6

Abstract

This paper aims at analyzing the profit efficiency of the Saudi banks, and testing how it could be affected by banking expansion. This has been conducted using a sample of 6 commercial banks (out of 11), and covering the period from 1998 to 2007. Profit efficiency has been measured, using the ratio of actual profitability to the best one, which a similar bank (in size) can realize. Tests indicated that we could accept hypotheses regarding the effects of "availability of phone banking", "number of ATMs" and "number of branches" on profit efficiency of Saudi banks, also referred to the need to reject the hypotheses regarding the effects of "number of POSs", "availability of PC banking" and "availability of mobile banking".

Keywords: Profit Efficiency, Banking Expansion

How to cite this paper: Alber, N. (2011). The effect of banking expansion on profit efficiency of Saudi banks [Special issue]. Corporate Ownership & Control, 8(2-1), 51-58. https://doi.org/10.22495/cocv8si1p6