Evaluating and ranking the Indian private sector banks—A multi‐criteria decision‐making approach

The paper examines the performance of Indian private sector banks based on various combinations of multi‐criteria decision‐making techniques. Annual reports of the respective banks were used to capture the data and measure the performance by considering multiple inputs and outputs. The data are anal...

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Bibliographic Details
Published in:Journal of public affairs 2022-05, Vol.22 (2), p.n/a
Main Authors: Sama, Hanumantha Rao, Kosuri, Sri Venkateswara Kumar, Kalvakolanu, Sripathi
Format: Article
Language:English
Subjects:
Annual reports
Banking
Criteria
Investments
Investors
Performance evaluation
Private sector
Public sector
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Summary:The paper examines the performance of Indian private sector banks based on various combinations of multi‐criteria decision‐making techniques. Annual reports of the respective banks were used to capture the data and measure the performance by considering multiple inputs and outputs. The data are analyzed through notable multiple criteria decision‐making (MCDM) techniques, CRITIC, TOPSIS, and grey relational analysis (GRA). The study reveals that HDFC is the best performing bank among other private sector banks and creates a benchmark. Applying the combination of MCDM techniques, namely CRITIC‐TOPSIS and CRITIC‐GRA, HDFC is ranked first followed by Bandhan Bank as the second. Other banks are ranked differently due to methodological differences. After obtaining the ranks by CRITIC‐TOPSIS and CRITIC‐GRA, the ranks are tested using the Wilcoxon signed‐rank test. Only private sector banks are considered for the current study. Future studies on the performance of banks can be taken up by comparing different types of banks, targeting an extension of the time frame studied. The findings suggest that the private sector banks need to increase their performance by investing in income‐generating areas. Improving the performance will help them in surviving in the market as well as competing with the top public sector and foreign banks. The findings can also be useful to various stakeholders and, in particular, to investors to know the value of the banks for future investments. For the first time, researchers have used a combination of MCDM techniques such as CRITIC‐TOPSIS and CRITIC‐GRA. Selected inputs and outputs have been studied for the private sector banks using MCDM techniques to measure the performance.
ISSN:1472-3891
1479-1854
DOI:10.1002/pa.2419