An investigation of exogenous environmental and scale efficiencies of Indian commercial banks

In this study, a three stage DEA model is used to measure the exogenous environmental efficiency of Indian Banks. The liberalization and globalization of financial markets pose a new challenge as well as provide new opportunities to banking industry in developing countries. Efficiency evaluation of banking sector helps to know about the performance of the banks comparing to other banks working in different environments and under different managements. Non-Performing Assets are used to identify the exogenous environment of a bank. The present study reveals that the public and private sector banks hurt more due to the scale and exogenous environmental inefficiency.