The impact of credit risk to operational efficiency of vietnamese commercial banks
Keywords:
credit risk, commercial bank, operational efficiency.
Abstract
In banking business, credit is the activity that brings the bank’s main profit but also the potential risk. This is a
major risk in banking business, so all credit and credit risk impacts on profitability as well as banking efficiency.
This article is intended to study the impact of credit risk on operational efficiency through return on assets (ROA),
return on equity (ROE), technical efficiency, pure technical efficiency, scale efficiency by regression models:
Pooled OLS, FEM, REM, FGLS. The results of the study show that credit risk has the opposite effect on the
operational efficiency, from which the author proposes solutions to limit credit risk to improve operational efficiency
of commercial banks in Vietnam.
