TAILIEUCHUNG - The effects of competition on efficiency: The Vietnamese banking industry experience

Given considerable changes in the Vietnamese banking environment brought about by significant reforms towards liberalization during the last two decades, this study investigates the evolution of competition and efficiency, compares the competition and efficiency of state-owned banks to jointstock banks, and then tests the “quiet life” hypothesis in this industry over the period 2000–2014. This study employs the efficiency-adjusted Lerner index (., market power) to capture competition, and the cost efficiency estimated by a Fourier-flexible function stochastic frontier analysis (SFA) to capture bank efficiency. This study firstly finds a slight improvement of competition and cost efficiency in the Vietnamese banking sector over the analysis period. Secondly, there are no significant differences in competition and cost efficiency level between state-owned and joint-stock banks. Thirdly, a positive causality running from competition to cost efficiency is documented, providing evidence of supporting the “quiet life” hypothesis. Finally, positive efficiency effects of the banks’ capital ratio and size are found, while insignificant impacts of the growth of GDP per capita and 2007 global financial crisis were observed. The results are strongly robust to a variety of tests. The findings suggest pro-competition, pro-capitalization and pro-size expansion policies in the Vietnamese banking sector if targeting at improving the cost efficiency of Vietnamese banks. | The effects of competition on efficiency: The Vietnamese banking industry experience

• Ngân hàng - Tín dụng
• Vietnamese banks
• Quiet life hypothesis
• Effects of competition on efficiency
• Banking industry experience
• Pro size expansion policies
• Determinants of capital adequacy ratio of Vietnamese commercial banks
• Capital adequacy ratio of Vietnamese commercial banks
• Vietnamese commercial banks
• The Net interest margin
• Capital adequacy ratio
• Summary of PHD thesis
• Impact of equity on financial stability
• Credit risk on financial stability of Vietnamese commercial banks
• The financial stability
• Summary of the thesis
• Competitiveness of Vietnamese commercial banks
• Merger and acquisition
• Competitive capacity
• Summary of Phd thesis Finance – Banking
• Impact of income diversification
• Performance of Vietnamese commercial banks
• Changing leadership style
• The Vietnamese commercial banks
• Vietnam joins the WTO
• State owned commercial banks
• OCAI culture diagnostic models
• Summary of Doctoral thesis
• Improving credit quality
• Vietnamese joint stock commercial banks
• Stock commercial banks
• Practical issues
• Industrial revolution 4 0
• Commercial banks
• State bank of Vietnam
• Developing opportunities
• Impact of liquidity transformation
• Liquidity transformation
• Vietnamese commercial banks adequacy ratio
• Banks adequacy ratio
• Credit risk CRSK
• Gross domestic product GDP
• Green banking
• Green finance
• EFA analysis
• Vietnamese economy
• Herfindahl Hirschman index
• Panzar Rosse model
• Vietnamese banking sector
• Monopoly competition market
• Summary of doctoral dissertation
• Summary of doctoral dissertation Accounting
• Completing the internal control
• Internal control in banks
• Summary of Economics Phd’s thesis
• Summary Phd’s thesis
• Employee based brand equity
• Statistical methods
• Joint Stock Commercial Bank
• Ngân hàng BIDV
• Corporate governance
• Performance in Vietnamese
• Bank performance
• Board composition
• Bad debt
• Loan loss provisions
• Loan losses
• Vietnamese system of commercial banks
• Risk management
• Accounting policy
• Cost efficiency
• Direct relationship
• Measuring the cost efficiency
• Bank cost efficiency
• Liquidity risk
• Annual reports
• Financing gap
• Independent variables
• Directional Distance
• Banking industry
• Productivity of Vietnamese banks
• Index approach
• Directional distance function
• Health of the banking system
• Thereby provide funding
• Bank liquidity creation
• Loan loss reserves
• Return on assets
• Return on capital
• Machine learning
• Credit scoring
• Big data
• Artificial intelligence
• Competency model for sales managers
• Sales managers
• Foreign scholars
• Summary of Doctoral thesis in Economics
• Internal control system
• Topic limits the scope
• Doctor of Philosophy in Economics thesis summary
• Liquidity positon
• Operational efficiency
• Banking operation
• Profitability of Vietnamese commercial banks
• Context of the world economic crisis
• World economic crisis