Productivity Analysis for Banks’ Merger and Acquisition Using Two-Stage DEA: Evidence from China

Abstract Mergers and acquisitions (M&A) are important parts of banking reform, which can increase the synergies reduce costs banks. To analyze effect importance M&A in reform period, we measure productivity change China’s banks who completed during 2004– 2018, by using a two-stage data envelopment analysis (DEA) method. First, incorporate process deposits producing profit earning as structure bank’s system. Then, construct slacks-based (SBM) model considering weak disposability undesirable outputs to 14 China. Particularly, adopt global Malmquist index (GMI) evaluate banks, efficiency (EC) technical (TC) for whole system individual stages. Additionally, facilitate making plans, classify obtain they need improve trend could adopted: (i) We them into four categories two stages; (ii) also EC TC. Finally, policy recommendations given.