The impact of information technology adoption on bank efficiency: Evidence from listed Vietnamese banks

In this study, we examined publicly listed commercial banks in Vietnam from 2014 to 2020 to investigate whether technology development has a non-linear effect on bank efficiency. We measured bank efficiency using Data Envelopment Analysis (DEA). The level of technological development was assessed using the Information Communication Technology (ICT) Index, which is published annually by the Vietnamese government. Consistent with our expectations, the results show an inverted U-shaped relationship between technological development and bank efficiency. This finding provides important insights for banks when planning and allocating their budgets for information and technology investments, particularly in the context of increasing digitalization in the banking sector.