The study aimed at exploring the relationship between efficiency and profitability of private commercial banks operating in Pakistan. The efficiency represented by technical efficiency has been assessed by non-parametric data envelopment analysis approach while profitability indicated by return on assets has been computed through conventional ratio analysis for period 2009 to 2013. The analysis revealed that technical efficiency declined during the study period and remained at 89%. HMB was identified as the top-performing bank in technical efficiency while MCB remained highly profitable. Banks were then grouped based on TE and ROA. MBL, UBL, DIB, SCB, BAH, HBL and HMB observed as top-performing banks based on TE and ROA. These banks are considered a role model for other inefficient and less profitable banks. Whereas, other banks were grouped as weak, based on below-average ROA and TE scores. These banks can adopt distinct product mix or business strategies to become profitable in future.

The aim of the present study is to investigate the efficiency of domestic and foreign commercial banks of Pakistan over the period from the year 2009 to 2013 through the DEA technique (Data envelopment analysis). DEA estimates efficiency by the ratio of inputs (multiple) to outputs (multiple). For this purpose, the number of employees, deposits and fixed assets were used as inputs while Advances and Investments were taken as the outputs based on the intermediation approach. Two generic forms of DEA explicitly CCR and BCC were applied to work out technical and pure-technical efficiencies, respectively. Results offered significant information to make the decision about the efficiency of commercial banks. The study outcomes showed that foreign owned banks performed better against public and private owned banks in respect of all the efficiency measures throughout the period of study.