An integrated SWARA-WSM model for analyzing performance of Indian banks

Abstract

The social and economic development of a nation in today's modern day world is critically dependent on performance of its banking system. An efficient banking system of a country can only productively channelize the monetary resources in the economy to successfully augment the societal and financial activities in the nation. With incessant transformation in regulation, expertise and competition in Indian banking industry over and above the rising cost-income ratios and non performing assets, it is imperative to analyse the performance of banks operating in India. There are multiple criteria, like long term business profitability, non performing asset (NPA), earning quality etc. which at times are contradictory in nature, impacting the successful operation of the banks. Therefore, in this paper, a novel method on the basis of step-wise weight assessment ratio analysis (SWARA) and weighted sum method (WSM) techniques is presented for the first time to select the best public sector bank in India on selected parameters. The SWARA technique is implemented here to estimate the relative importance of the criteria and the WSM methodology is employed to prioritize the alternatives. The results derived from implementation of proposed integrated SWARA-WSM model can assist policy makers to better understand the preeminent parameters leading towards sustainable success of banks.