| Summary: | 碩士 === 臺灣大學 === 經濟學研究所 === 96 === This paper studies the performances of subsidiary banks of Financial Holding Company (FHC) and banks of non-FHC after the pass of Financial Holding Company Act. We apply a translog cost function, a panel data fix-effect model, different definitions for output (by revenue and asset), as well as economies of scale and economies of scope index, to analyze the cost efficiency of 13 subsidiary banks of FHC and 30 banks of non-FHC for 2002-2006 and to see whether the FHC Act can bring more benefits and improve efficiency for Taiwan’s bank industry. Our major findings are: (1) Economies of scale: the subsidiary banks of FHC don’t have economies of scale under the two different definitions for output. (2) Economies of scope: if output is defined by revenue, fee revenue has cost complementary for subsidiary banks of FHC while cost revenue has for banks of non-FHC. If output is defined by asset, only loan has cost complementary with investment asset for both. (3) For FHC, mergers and acquisitions cross different industries don’t improve the cost efficiency of its’ subsidiary banks. (4) On average, the subsidiary banks of FHC don’t reveal better cost efficiency than the banks of non-FHC.
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