Measuring the Productivity of Serbian Banks Using Malmquist Index

Milanka Marković; Snežana Knežević; Andrijana Brown; Veljko Dmitrović

doi:10.7595/management.fon.2015.0022

Milanka Marković Belgrade Business School, Belgrade
Snežana Knežević University of Belgrade, Faculty of Organizational Science, Serbia
Andrijana Brown Liberty Tax Inc., Leesburg, Virginia
Veljko Dmitrović University of Belgrade, Faculty of Organizational Sciences , Serbia

DOI: https://doi.org/10.7595/management.fon.2015.0022

Abstract

This paper evaluates the scale of productivity change of the Bank of Serbia over the period 2007- 2010. In this research the emphasis is put on measuring the productivity based on information from the financial statements using Data Envelopment Analysis (DEA) method and Malmquist index to estimate the individual bank efficiency and productivity changes within this period. The Malmquist productivity indices have been decomposed into technical changes of efficiency index and index of technology changes. DEA is an increasingly popular management tool. It is widely known what represents an input and what is output in banking operations, but for an adequate analysis of the efficiency or the productivity of banks it is essential to choose the right combination of inputs and outputs of the bank. In relevant academic literature various combinations of inputsand outputs could be seen for measuring the efficiency and productivity of banks. This paper shows the productivity decrease of the banking sector.

Author Biographies

Milanka Marković, Belgrade Business School, Belgrade

Dr. Milanka T. Stojanovic, married Markovic was a professor at the Belgrade Business School and lectured on the subjects of Business Mathematics and Business Statistics. She graduated in 1971 in mathematics from the Faculty of Science, University of Belgrade, where she became a holder of a Masters Degree in 1975 in mathematical sciences. She defended the doctoral thesis at the Faculty of Economics in Belgrade and acquired the degree of Ph.D. in statistics. She was head of the Department of Mathematics and Statistics. She is the author of the textbook titled Statistical Quality Control and co-author of the Quality management textbook. Additionally, she is a co-author of the textbook titled Business statistics (2004), of A Collection of assessment tasks from business statistics (2003), Practicum in Mathematics (2006). In addition, she has published several scientific papers in the field of mathematics and statistics. She was a designer of numerous statistical surveys. Research areas: application of mathematical methods, financial methods, as wellas statistical methods using computer software. Presently, she is a retired professor.

Snežana Knežević, University of Belgrade, Faculty of Organizational Science, Serbia

Snežana Knežević was born in 1966 in Pančevo (Jabuka), where she graduated from the school of economics. She graduated from the Faculty of Economics in Belgrade where she also got her MSc degree. She got her PhD degree at the Faculty of Organizational Sciences in Belgrade. The areas of her scientific interest are Finance,
Accounting and Environmental protection. She is fluent in French and English. She has published several monographs and papers of scientific and professional orientation in the country and abroad. Currently, she works at the Faculty of Organizational Sciences in Belgrade, Department of Financial Management. She is an associate member of the Scientific Society Of Economists and a member ot the EUMMAS (European Marketing and Management Association).

Andrijana Brown, Liberty Tax Inc., Leesburg, Virginia

Andrijana Brown was born in 1976. She completed her undergraduate studies at the Faculty of Economics in Belgrade in 2005 (Bachelors Degree in Economics, Major: Accounting, Banking, Finance and Insurance). At Stratford University, Virginia, she completed her Masters of Science in Accounting studies. The major professional areas of her consideration are accounting, auditing and taxation issues.She is working as an Auditor in Defense Contract Audit Agency. She is a CPA candidate in Virginia.

Veljko Dmitrović, University of Belgrade, Faculty of Organizational Sciences , Serbia

Veljko Dmitrović works at the Faculty of Organizational Sciences, University of Belgrade, at the Department of Financial Management and Accounting. He is completing his PhD studies at the Faculty of Organizational Sciences. He achieved his MSc degree in Financial Management at the Faculty of Organizational Sciences, University of Belgrade, and his BSc and MA degrees in Marketing Management at the Faculty of Economics in
Subotica, University of Novi Sad. So far he has authored and coauthored more than 50 papers published in international and national journals and conferences. He has been involved in several research projects. Before the academic career he gained practical experience working for five years in “Fidelinka” a.d., Subotica.