The world’s financial system is one of the globe’s most powerful structures, however the institutions that make up this network of banking firms are certainly not immune to the pressures of market globalization and technical innovation that drive change within the financial landscape. In order to exist within such an environment, the world’s largest commercial banks must constantly reevaluate the ways in which they function in order keep pace in the competitive market. It is imperative that they not only seek to further develop the disciplines in which they already excel but focus on how they can become more productive, efficient entities. In doing so these financial intermediaries will certainly be able to better function and adapt in a dynamic global financial market.
The objective of this paper is to examine the efficiency of ten of the world’s largest commercial banks during the period spanning from 2006 to 2015. Utilizing a data envelopment analysis (DEA) output oriented model this study explores how these banking firms navigated the tumultuous landscape that was created at the hands of the most recent financial crisis. The study not only focuses on firm behavior during the crisis itself but the years surrounding the financial collapse as well, keying in on relationships between banking practices, and firm efficiency during a time of unethical conduct in the financial realm. The results derived from this study will not only allow one to observe what makes a banking firm more efficient, but will also display the inefficiencies or behaviors that can ultimately lead to financial crises.