Econometric Analysis of Bank Assets in Improving The Efficiency of Commercial Banks

The continuous evolution of global financial markets has heightened the need for commercial banks to operate efficiently, particularly in how they manage and allocate their assets. This paper presents an econometric analysis of bank assets to assess their role in enhancing the efficiency of commercial banks. Using panel data from a selected group of commercial banks over a decade, we apply econometric models including Data Envelopment Analysis (DEA) and Stochastic Frontier Analysis (SFA) to evaluate asset allocation efficiency and productivity. The study demonstrates that the efficient deployment of assets such as loans, investments, and reserves significantly influences profitability, operational performance, and risk mitigation. Furthermore, we find that technological advancement, regulatory compliance, and risk management practices play mediating roles in determining the impact of asset structures on banking efficiency. The paper concludes by offering strategic policy implications for asset management to optimize bank performance in dynamic market environments.