The Impact Of Soft Information And Institutional Quality On Foreign Bank Efficiency: Evidence From Asean-5 Countries

Sok Gee  Chan; Bora Aktan; Bruce Burton; Eric H. Y.  Koh

doi:10.1016/j.iref.2021.01.017

The Impact Of Soft Information And Institutional Quality On Foreign Bank Efficiency: Evidence From Asean-5 Countries

Sok Gee Chan, Bora Aktan, Bruce Burton (Lead / Corresponding author), Eric H. Y. Koh

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8 Citations (Scopus)

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Abstract

This paper provides evidence regarding the impact of soft information on foreign bank efficiency in the ASEAN-5 market in the years following the Asian crisis. The analysis presented here develops previous literature by disaggregating soft information into five difference types and examining whether institutional quality (proxied for by host-country economic risk stability index) mitigates the impact. Using a three-stage estimation process we find that soft information does indeed affect foreign banks’ efficiencies in an identifiable manner, but host-country institutional quality acts so as to significantly lessen the effect.

Original language	English
Pages (from-to)	23-32
Number of pages	10
Journal	International Review of Economics and Finance (IREF)
Volume	74
Early online date	12 Feb 2021
DOIs	https://doi.org/10.1016/j.iref.2021.01.017
Publication status	Published - 1 Jul 2021

Keywords

ASEAN-5
Data envelopment analysis
Foreign bank efficiency
Generalized method of moments
Institutional quality
Soft information

ASJC Scopus subject areas

Finance
Economics and Econometrics

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abstract = "This paper provides evidence regarding the impact of soft information on foreign bank efficiency in the ASEAN-5 market in the years following the Asian crisis. The analysis presented here develops previous literature by disaggregating soft information into five difference types and examining whether institutional quality (proxied for by host-country economic risk stability index) mitigates the impact. Using a three-stage estimation process we find that soft information does indeed affect foreign banks{\textquoteright} efficiencies in an identifiable manner, but host-country institutional quality acts so as to significantly lessen the effect.",

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AB - This paper provides evidence regarding the impact of soft information on foreign bank efficiency in the ASEAN-5 market in the years following the Asian crisis. The analysis presented here develops previous literature by disaggregating soft information into five difference types and examining whether institutional quality (proxied for by host-country economic risk stability index) mitigates the impact. Using a three-stage estimation process we find that soft information does indeed affect foreign banks’ efficiencies in an identifiable manner, but host-country institutional quality acts so as to significantly lessen the effect.

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KW - Data envelopment analysis

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KW - Generalized method of moments

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JO - International Review of Economics and Finance (IREF)

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The Impact Of Soft Information And Institutional Quality On Foreign Bank Efficiency: Evidence From Asean-5 Countries

Abstract

Keywords

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