Investigating the Efficiency of Islamic Banks in Different Countries (DEA Approach)

Ebrahimi, Saeed; Bidram, Rassool; Emadzadeh, Mostafa

Investigating the Efficiency of Islamic Banks in Different Countries (DEA Approach)

Authors

¹ Faculty Member of Sheikh Bahaee University

² Ph.D of University of Isfahan

³ Full Professor of University of Isfahan

Abstract

One of the most important problems in economic literature is the question of
evaluating different parts of an organization and determining the indexes for this
work. Therefore, we need some suitable indexes. In this context there are different
methods, but DEA method (Data Envelopment Analysis) is a very effective and
dynamic index for measuring efficiency and productivity. In this method we select
one or more firms (banks) from among the efficient firms and compare them with
each other and calculate the input or output slacks of each inefficient firm.
In this paper according to DEA method we have measured the efficiency of 40
Islamic banks in different countries with the assumption of variable return to scale
(VRS) and constant return to scale (CRS). The results indicate that with CRS
assumption, Qatar international Islamic bank, Sudan state bank, Pakistan kheibar
bank, Bahrain albaraka bank, Bahrain Islamic ABC bank, Yamane Islamic bank,
turkish albarakat Islamic bank proved efficient banks and with VRS assumption
Qatar Islamic bank, Albany Islamic Arabic bank, Pakistan habib bank, Senegal Islamic bank, Qazaqestan state bank, Egypt SAE bank, Sudan state bank, Aboozabi
Islamic bank, Pakistan kheibar bank, Bahrain Albaraka Islamic bank, Bahrain
Islamic ABC bank, Keshavrzi bank, Maskan bank, Melli bank, Refah bank, Saderat
bank, Yamane Islamic bank and Turkish albarakat bank proved efficient.

Keywords