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

Research output: Contribution to journalArticlepeer-review

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 languageEnglish
Pages (from-to)23-32
Number of pages10
JournalInternational Review of Economics & Finance
Volume74
Early online date12 Feb 2021
DOIs
Publication statusE-pub ahead of print - 12 Feb 2021

Keywords

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

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