*Article* **European Bank's Performance and E** ffi**ciency**

**Maria Elisabete Duarte Neves 1,2,\*, Maria Do Castelo Gouveia 1,3 and Catarina Alexandra Neves Proença 1**


Received: 3 March 2020; Accepted: 1 April 2020; Published: 5 April 2020

**Abstract:** The research interest in bank profitability and e fficiency is linked to the economic situation and an important issue for policymakers is to ensure economic stability. Nevertheless, managerial decisions and the environment could play a critical role in ensuring proper and e fficient allocation of the resources. The purpose of this study is to understand which are the main factors that can influence the performance and e fficiency of 94 commercial listed banks from Eurozone countries through a dynamic evaluation, in the period between 2011 and 2016. To achieve this aim, the generalized method of moments estimator technique is used to analyze the influence of some bank-specific characteristics, controlled by management, on the profitability as a measure of bank performance. After that, through the value-based data envelopment analysis (DEA) methodology, those factors are considered in determining the e fficient banks. The results show that banking e fficiency depends on set bank-specific characteristics and that the e ffect of determinants on e fficiency di ffers, considering the macroeconomic conditions.

**Keywords:** determinants of bank performance; generalized method of moments; value-based DEA; multi-criteria decision aiding

**JEL Classification:** G21; G15; C33; C44; C61
