TY  - JOUR
AB  - This paper studies the profit efficiency of a sample of large U.S. commercial banks and explores how this performance varies with selected measures of bank risk reflecting aspects of credit risk, liquidity risk, and insolvency risk. We use a standard profit function and the stochastic frontier approach, and compare two standard functional forms – Cobb‐Douglas and translog – to assess the tradeoff between precision and parsimony. We find that profit efficiency is sensitive to credit risk and insolvency risk but not to liquidity risk or to the mix of loan products.
VL  - 30
IS  - 9
SN  - 0307-4358
DO  - 10.1108/03074350410769245
UR  - https://doi.org/10.1108/03074350410769245
AU  - Fan Linbo
AU  - Shaffer Sherrill
PY  - 2004
Y1  - 2004/01/01
TI  - Efficiency versus risk in large domestic US banks
T2  - Managerial Finance
PB  - Emerald Group Publishing Limited
SP  - 1
EP  - 19
Y2  - 2024/04/19
ER  -