The aim of this paper is to determine the degree of technical eficiency of the Spanish Savings Banks and its temporal variation in the 1985- 1994 period. To that end, a stochastic production frontier is estimated using panel data and assuming the efficiency term follows the specification proposed by Battese and Coelli (1992). In a second stage, a Tobit model is estimated to find the relationships between the efficiency indexes and other explanatory variables. The main conclusion obtained from the econometric work is that the time-invariant technical efficiency hypothesis is not rejected in that period. In the second stage, we find that the smallest firms and those that adopt strategies directed towards the assets markets achieve greater efficiency levels.

Keywords: technical efficiency, stochastic frontier, Tobit, Savings Banks.