Analysis of Chinese Commercial Banks’ Risk Management Efficiency Based on the PCA-DEA Approach

Table 2

The input and output indicators of risk management efficiency.

The types of DEA indicators	The name of the indicator	The meaning of the indicator
Inputs	The liquidity ratio	To measure liquidity risk
	The ratio of loans to the top ten customers	To measure credit risk
	The concentration of loans to a single customer
	The provision coverage ratio	To measure market risk
	The loan-to-deposit ratio
	The migration rate of normal loans	To measure changes in the asset quality of commercial banks
	The migration rate of nonperforming loans
	Capital adequacy ratio	To measure the capital adequacy of commercial banks
	Cost-to-income ratio	To measure the profitability of commercial banks
	Loan reserve for doubtful debts	To measure the adequacy of banks’ reserves
Outputs	Operating income growth rate	To measure the profitability of commercial banks
	Net profit growth rate
	Return on net assets	To measure the returns of shareholders