Journal of Siberian Federal University. Humanities & Social Sciences / Stochastic Frotier Analysis of the Profitability of the Russian Banking System

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Issue
Journal of Siberian Federal University. Humanities & Social Sciences. 2025 18 (6)
Authors
Perfiliev, Aleksandr A.; Bufetova, Lidiia P.; Shen Bingbing
Contact information
Bufetova, Lidiia P. : Novosibirsk State University Novosibirsk, Russian Federation; ; ORCID: 0000-0001-9015-2136; Shen Bingbing: Novosibirsk State University Novosibirsk, Russian Federation; ORCID: 0000-0001-6819-0507
Keywords
banking sector; assessment of bank profitability; stochastic frontier analysis; efficiency analysis of banking systems
Abstract

The article provides an assessment of the profitability of the Russian banking sector for the period 2012–2020 by the frontier method, which has entered into the practice of analyzing the performance of the banking sector in different countries. The article uses the stochastic frontier method with the production function in translogarithmic form. The method allows to estimate the efficiency of profitability, which is understood as the degree of remoteness of the bank’s position from the production possibility frontier of the banking system. Relying on this method, the efficiency of the banking sector of the Russian Federation in terms of the ability to create profits for its investors has been estimated. The result shows that the average level of such efficiency in the banking system is 64 % and remains stable during the period under review. The main reason for the underutilization of banks’ profitability potential is the inefficient use of available resources. Differences in the level of efficiency of individual groups of banks are related to the size of banks

Pages
1076–1090
EDN
VENIPY
Paper at repository of SibFU
https://elib.sfu-kras.ru/handle/2311/156190

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