Despite a vast amount of literature on the banks of developed and emerging countries , the
literature still suffers from a scarcity of studies on Central and Eastern European (CEE hereafter)
countries including the new members of the EU as well as candidate countries. Specifically, for the
transition countries, much emphasis has been given to the efficiency of the financial institutions and
the impact of the ownership on the performance of financial institutions with regard to the foreign
investors’ participation in the financial systems of the CEE countries (Grigoran and Manole, 2002;
Green et al., 2004; Fries and Taci, 2005; Carvallo and Kasman, 2005 and Yildirim and Philippatos,
2007). However, the current literature continues to suffer from the scarcity of comprehensive and
sufficient empirical studies that concentrate on the relationship between efficiency and bank stock
performance in transition countries.