Year of Graduation
Analyzing Efficiency of Russian Banks Performance: Theoretical and Empirical Approaches
Faculty of Economics
The present paper focuses on the issue of analyzing efficiency of Russian banks performance. The relevance of this work is caused by changes in financial sector. Since the late 1970s banking institutions have been transformed from almost purely financial intermediaries to retail service providers. With reference to Russian banking system these changes started in 2000s.To measure technical efficiency is evaluated by stochastic production frontier analysis. In the study, we analyze non-interest income as output and reserves, non-interest expenses and administrative costs as inputs. Finally we reject hypothesis that TOP-100 banks are less efficient than the other, accept hypothesis that Russian banks have opportunity to grow due to non-interest income. Moreover, our findings suggest that there are weak correlation between technical efficiency and return on assets and between technical efficiency and return on equity.