What explains the operational efficiency of listed commercial banks in China? Evidence from a three-stage DEA-tobit modeling analysis

Based on the actual situation of listed commercial banks in China, this study utilizes a three-stage DEA model to eliminate external macro-environmental factors and random error factors. As a result, the study objectively measures the true efficiency values of 42 listed commercial banks in China from 2015 to 2021. On this basis, a Tobit model is constructed to analyze the micro-level factors influencing the operational efficiency of listed commercial banks in China. Empirical research shows that the operational efficiency values in the first stage are significantly lower than those in the third stage. Analyzing the proportion of banks with an efficiency value of 1, it is found that state-owned banks and joint-stock banks account for a large proportion. The proportion of city commercial banks decreases significantly, while agricultural banks and commercial banks have the lowest proportion. In addition, the Tobit regression results show that bank size, innovation level, profitability, and development capacity have a significant positive impact on the operational efficiency of listed commercial banks in China at the current stage. Based on the above empirical results and analysis, specific measures are proposed to improve the operational efficiency of listed commercial banks in China. Based on the above empirical results and analysis, the study finally suggests the following specific measures to enhance the operational efficiency of listed commercial banks in China: 1. Strengthening technological investment to achieve diversified operations and cultivate new niche markets; 2. Emphasizing intermediate business income to enhance market competitiveness; 3. Undertaking digital transformation and upgrading to improve sustainable profitability.