Assessing Bank’s Efficiency in Indonesia Using Data Envelopment Analysis (DEA)

(Evidence from Indonesia in 2008 – 2017)

Abstract

The purpose of this study is to assess an efficiency analysis of 85 banks in Indonesia by using Data Envelopment Analysis Method throughout 2018 - 2017. From the 85 Banks, it is divided into 5 categories namely Foreign Banks, Mixed Banks, Rural Bank, State-Owned Banks, National Foreign Exchange Banks and National Non-Foreign Exchange Banks. The results showed that during 2018 - 2017 the Bank's efficiency level in Indonesia was at the level of 0.744, more specifically the Rural Bank had the highest efficiency level with an efficiency score of 0.776, followed by Mixed Banks of 0.772, State-Owned Banks at 0.763 and National Private Banks amounting to 0.756. There are two groups of banks that have a level of efficiency score below the average such as Non-Foreign Exchange National Private Banks and Foreign Banks, with efficiency scores of 0.728 and 0.579 respectively.