Accounting and financial performance analysis in the brazilian bank sector through the application of Data Envelopment Analysis (DEA)

Márcio Flávio Amaral de Souza, Marcelo Alvaro da Silva Macedo


The objective of this study is to analyze the multicriterial performance of banks in operation in Brazil during the period from 2001 to 2005, using Data Envelopment Analysis (DEA). For that an analysis was conducted using leverage indicators, operational costs, immobilization, immediate liquidity, deposits levels, credit operations levels and operational return. From the identification of the 100’s biggest banks showed in the list published by Valor Financeiro Magazine between 2002 and 2006, the study analyzed the indicators under two aspects, plus the discussion about the modeling presented. First of all it was made an analysis about the banks efficiency distributed in four segments: wholesale, middle market, financing and retail. Secondly it is sought to demonstrate the relative performance of the 100’s biggest all along five years, with the aim to make a competitiveness sector analysis panel. Related to the general analysis, it was pointed that immobilization was the variable with biggest need of reduction to increase the efficiency of the sector, occurring a change of level in the last two years of the research in comparison to the period 2001-2003. It was also noticed that efficiency was related to low operational costs and high level yields. On the segments analysis, the wholesale banking was the most efficient and, in a general, in each segment the performance leaders were not the banks with the highest assets. In the end, it was noticed that, although the increase in banking concentration of the country, the competition degree on the pointed ratios of this research appears to be sufficiently high.

Key words: performance, accounting and financial ratios, banks, data envelopment analysis (DEA).

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