The determinants of bank efficiency in central Asia

Abstract

This paper examines progress in the transition to a market economy of the banking sector of Central Asia (CA), a region that was late to take on reform and which has largely been ignored in the literature. A comparison to other previous Soviet Republics shows that the banks in the Baltic States have higher profit efficiency compared to those in CA. The results also suggest that state owned banks are less profit efficient than private banks although foreign ownership is not a factor in efficiency levels of banks in Central Asia.