Efficiency of Islamic Banks in Sudan: A non-parametric Approach1

Abstract

This paper employs several efficiency measures and productivity changes using Data Envelopment Analysis (DEA) to investigate efficiency performance of Islamic banks in Sudan, using data from annual reports of 12 banks during the sample period 2007-20084. The study results indicate, only two banks (the largest bank in the group, government owned and middle sized, private bank), scored technical efficiency level (i.e. scale and pure technical efficiency). While the smallest bank in the group (private owned), scored pure technical efficiency (i.e., managerial efficiency), but scale inefficient. These results add to the existing literature findings, that ownership is not a constraint of managerial and scale efficiency but bank’s size is important factor for scale efficiency in Islamic banks.