The share of off-balance sheet activity (OBSa) in the future of banking business has been questioned by the use of low-quality assets in this activity. Nevertheless, this paper puts forward the adverse selection hypothesis, which counter argues that more stable banks engage in OBSa to a larger...

Chapter 1: Introduction -- Chapter 2: Conceptual background: firms’ objectives, decision variables and economic efficiency -- Part I -- Chapter 3: Shephard’s input and output distance functions: cost and revenue efficiency decompositions -- Chapter 4: The generalized distance function (GDF):...