Stock return is the best measure to estimate the creation of value for shareholder wealth
(Brealey and Myers, 1991). All things being equal, cost and/or profit efficient banks may be expected
to generate greater shareholder returns and, therefore, will be reflected in greater better stock
performance. In terms of efficiency estimations, a decline in the cost or an increase in the profitability
of a bank is expected to create better financial performance as well as greater stock returns. Just like
the traditional accounting measures, this is not surprising to examine whether cost or profit efficiency
estimates are taken into consideration in the stock price formation process.