Bank Efficiency in Indonesia in the Perspective of an Intermediation Approach

To be able to achieve the best level of efficiency, the bank must be able to manage the inputs owned and the outputs produced in between. In addition, banks must also be able to manage operational costs and operating income. In this analysis of efficiency is calculation of the ratio between input and output variables. This research is using nonparametric Data Envelopment Analysis (DEA) for bank in Indonesia in group level two (BUKU II) banks which registered at IDX with period of analysis in 2014 – 2018. To analyze its efficiency by using intermediary approach. The sample analysis are taken from all population banks in BUKU II that already go public, which consist of two sharia banks, and sixteen conventional banks (four foreign banks, one state-owned bank and eleven national private banks). The results of the study indicate that there are several banks that are able to achieve a level of efficiency both using the intermediation approach. In 2014, there were four banks that were able to achieve efficiency levels. In 2015 and 2016, only three banks was able to achieve efficiency levels. However, in 2017 only two banks was able to reach the level of efficiency. In 2018 there were four banks that were able to achieve a level of efficiency using the intemediation. The results of this study are expected to be useful for evaluating the level of efficiency that occurs in banks in Indonesia