Does Financial Regulation Influence Bank Efficiency? A Study on UAE Banking Sector

A well-functioning, stable, and efficient banking system contributes to 5 the economic growth of a country. Financial regulation has been highlighted as 6 an important factor which influences bank performance and safety as evidenced 7 by some of the studies in the past. This study analyzes the relationship between 8 financial regulation and bank efficiency in the UAE. First part of our study is 9 modeled on DEA analysis and indicates an improvement in profit efficiency during 10 the selected period. The second part of our study analyzed the impact of financial 11 regulations on the banks' efficiency using Tobit regression. The regulatory variables 12 included for this are loan to deposit ratio, advances to stable resources, total capital 13 adequacy ratio, tier 1 capital to risk-weighted assets (RWA), provision coverage, 14 and loan loss provision