“The study focuses on the effect of gradual deregulation in a developing economy on the efficiency of banks and the banking sector. It assesses whether the policy package results in an improvement in the technical efficiency of the industry. This study adopts the data envelopment analysis (approach) that has been used to assess intertemporal changes in efficiency as well as the relative inefficiency of government controlled banks compared with private (new generation) banks. The study found that banking industry efficiency declined significantly during the years immediately following the adoption of deregulation, with slight improvements noticed only in recent times. The study concludes that this may be the effect of inconsistent policies to which the sector was subjected during this period.”
