International Journal of

ADVANCED AND APPLIED SCIENCES

EISSN: 2313-3724, Print ISSN: 2313-626X

Frequency: 12

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 Volume 12, Issue 9 (September 2025), Pages: 252-265

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 Original Research Paper

The impact of non-traditional activities on the technical efficiency of commercial banks: Evidence from Vietnam

 Author(s): 

 Doan Trang Do 1, Anh Hoang Le 2, *

 Affiliation(s):

  1Faculty of Economics, Binh Duong University, Ho Chi Minh City, Vietnam
  2Faculty of Banking, Ho Chi Minh University of Banking, Ho Chi Minh City, Vietnam

 Full text

    Full Text - PDF

 * Corresponding Author. 

   Corresponding author's ORCID profile:  https://orcid.org/0000-0002-9670-2060

 Digital Object Identifier (DOI)

  https://doi.org/10.21833/ijaas.2025.09.025

 Abstract

This study investigates the effect of non-traditional activities on the operational efficiency of Vietnamese commercial banks during the period 2016–2024. The data envelopment analysis (DEA) method is used to measure bank efficiency, while fixed effects, random effects, and system generalized method of moments (GMM) models are applied for estimation. The results indicate that non-traditional activities (NTAs) improve bank efficiency. In addition, the lagged value of bank efficiency and the ratio of loans to total assets have a positive influence on efficiency. In contrast, bank size and inflation reduce efficiency. The study does not find evidence of a relationship between return on assets, capital adequacy ratio, and economic growth rate with bank efficiency. These results provide useful insights for commercial banks in developing new non-traditional products and services to enhance operational efficiency.

 © 2025 The Authors. Published by IASE.

 This is an open access article under the CC BY-NC-ND license ( http://creativecommons.org/licenses/by-nc-nd/4.0/).

 Keywords

 Bank efficiency, Non-traditional activities, Data envelopment analysis, Vietnamese banks, System GMM

 Article history

 Received 27 April 2025, Received in revised form 6 August 2025, Accepted 28 August 2025

 Funding

The authors gratefully acknowledge the financial and institutional support provided by the Ho Chi Minh University of Banking. This support facilitated access to research resources, data, and academic infrastructure, which significantly contributed to the successful completion of this study. The funding body had no role in the design of the study, data collection, analysis, interpretation of results, or writing of the manuscript. 

 Acknowledgment

No Acknowledgment. 

 Compliance with ethical standards

 Conflict of interest: The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

 Citation:

 Do DT and Le AH (2025). The impact of non-traditional activities on the technical efficiency of commercial banks: Evidence from Vietnam. International Journal of Advanced and Applied Sciences, 12(9): 252-265

  Permanent Link to this page

 Figures

  Fig. 1  Fig. 2  Fig. 3 

 Tables

  Table 1  Table 2  Table 3  Table 4  Table 5

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