Optimizing the Efficiency of Financial Companies in Malaysia with Super-Efficiency Data Envelopment Analysis Model

Abstract

Financial companies play a very important role in promoting the economic growth of a country. Therefore, the efficiency of the financial companies should be observed closely and consistently by the practitioners. This study aims to determine the efficiency and the potential improvement of the financial companies in Malaysia. The efficiency of the financial companies is evaluated with the proposed super-efficiency Data Envelopment Analysis (DEA) model. Based on the optimal solution of DEA model, BIMB, HLFG, LPI, MANULFE, PBBANK, and TA are classified as efficient companies. This indicates that these efficient companies are fully utilizing the inputs in generating the maximum outputs. The significance of this study is to determine the efficiency score achieved by the companies, rank the companies according to the efficiency score as well as identify the potential improvement for the inefficient companies.