Control of loans and evaluation of effectiveness of banks in the scope of internal control

Lending is the highest revenue earning activity for banks. But defaulting on loans can effect their all activities and reduce their effectiveness. Hence, control of loans during internal controlling process has a great importance.In this study, it is aimed to evaluate the effectiveness of internal control departments of the banks in Turkey by using data envelopment analysis. The number of internal controllers who work in banks and the total amount of loans are taken as inputs, the ratio of loans except non performing loans in total credits and interest proceeds from credits are taken as outputs for the evaluation. Which banks are efficient in which period is determined in this study. As a result, it?s concluded that works of internal control personnel effect the control of loans and it increases the efficiency of banks.