Abstract
It is necessary for decision-makers to have a rating system in the banking industry in order to reflect the banks' status and performance. Although most institutions across the countries have rating banks and financial institutions, there is a lack of a comprehensive rating system across Iranian banks. Rating requires identifying the appropriate criteria according to the environmental and macroeconomic conditions. For this purpose, 35 components are determined through the opinion of 34 banking and academic experts using the Delphi method and rating is done by the TOPSIS method for 15 banks listed on the Tehran stock exchange over the period of 5 years from 2015 to 2019. The results show that in addition to the quantitative aspects, the qualitative aspects and aspects related to environmental and macro aspects are effective in the native model of banks ratings. Also, there is a positive and significant relationship between banks stock prices variation and the suggested ratings. The obtained results showed that there is a positive and significant correlation between the comprehensive model and early warning system so that the bank's position can be relatively described in the early warning system by identifying it within the model. This evidence addresses the need for a comprehensive consideration of proposed indicators to evaluate and rate banks.
Highlights
The inability of people to analyze the banks status and the lack of a specific model to evaluate and compare them along with the lack of independent accreditation institutions have led the banking system to become disturbed in a way that they perform risky and out-of-scope activities
The results have shown that the Middle East Bank is at the first rank and Ayandeh Bank is at the last rank in terms of credit rating
52 factors have been identified by studying the theoretical foundations, 35 factors have been determined according to viewpoints of the banking and academic experts on the importance of factors and availability of required data for this research; in addition, their significance, the way of measuring, as well as their influence on rating model have been recognized
Summary
The inability of people to analyze the banks status and the lack of a specific model to evaluate and compare them along with the lack of independent accreditation institutions have led the banking system to become disturbed in a way that they perform risky and out-of-scope activities. On the other hand, attracting foreign investors into the country requires the necessary transparency and legal framework to provide banking safety These reasons have necessitated the existence of an optimal accreditation system that would enable a comprehensive and rational evaluation of the country's conditions as well as meet the national and international requirements of banks. The constant monitoring and providing appropriate approaches can reduce the occurrence of unpredictable economic fluctuations; despite the importance of this issue, a specific framework for periodic evaluation of the country's banks has not been determined yet in terms of financial performance accuracy, and bank evaluations are usually performed by the central bank inspectors' visiting of banks, which is not so effective due to the lack of comprehensive and local indicators (Abbasi & Nazemi, 2020).
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