As in other countries in the world, the banking industry in Vietnam has been playing a significant role to the overall economic development of the country, especially after Vietnam’s joining the World Trade Organization (WTO) in 2007. Concerning the impact of Vietnam’s integration into the WTO on the nation’s economy in general and on the banking system of Vietnam in particular, it can be seen that Vietnam banking has changed in a number of ways. Over the last two decades, the Vietnamese banking system did gradually develop in terms of size of the banking sector in the economy, number of banking institutions, amount of credits for the economy, and amount of other banking services. However, there is still a lack of research on the efficiency of the banking sector in Vietnam over the time. This research, with a focus on evaluating the efficiency of 34 Vietnamese commercial banks during the period of four years from 2007 to 2010 using Data Envelopment Analysis (DEA), is supposed to make a contribution to the progress of those works on the banking system of Vietnam. The results indicate that the average (mean) scores of the efficiency of the sampled banks were close to the optimal point. However, Vietnamese commercial banks experienced a fall in efficiency score when the global financial crisis broke out in 2008. Additionally, the state-owned commercial banks are proved to be relatively less efficient than the joint-stock banks in the given period. The study’s main findings can assist bank managers and governors in understanding their bank’s efficiency as well as the reasons of their inefficiency. Additionally, it is hoped that some suggestions can be given in order to improve the efficiency of the Vietnamese commercial banks.
