Financial Sector Liberalization and Efficiency

Financial sector of Pakistan has been transformed over the last three decades through Liberalization, the privatization of nationalized commercial banks, entrance of domestic private banks, the removal of barriers on the entry of foreign banks, the introduction of prudential regulations and merger and acquistion reforms. The effects of these reforms have measured by using descriptive and ordinary least square(OLS) techniques.The descriptive results hows that during pre-reform,first reform and second reform period foreign banks were the most efficient banks in profit earnings,domestic private banks,Public banks and privatized banks following respectively. But during the third reform period private banks were the most efficient in profit earnings,foreign banks and public banks and privatized banks following respectively.