EFFICIENCY MEASUREMENT OF CONVENTIONAL BANKING: CASE STUDY KBMI 3 BANK GROUPS

Abstract

In 2022, Indonesia's banking sector experienced a recovery after contraction due to the pandemic. This can be seen from the 7.73% growth in national banking assets to IDR 10.49 quadrillion as of September 2022. However, this study highlights whether this growth is followed by the level of efficiency. The research objective is to measure the efficiency level of bank group based on KBMI 3 during the period, using Data Envelopment Analysis technique. The input variables used consist of third party funds, operating expenses, and total assets as well as variable outputs outstanding credits, operating income and net profit. The results of Data Envelopment Analysis showed that most conventional bank companies achieved efficiency, but some experienced inefficiency, indicating the need for improvement in input variables to achieve optimal output results.