Integration of ARAS and MOORA MCDM Techniques for Measuring the Performance of Private Sector Banks in India

Abstract

This current research paper measures the performance of Indian private sector banks through various multi-criteria decision-making (MCDM) techniques. To measure the performance of the banks the data about various criteria such as profit after tax, borrowings, advances, adjusted EPS, enterprise value, and NPAs from the Annual reports of the banks were extracted. The MCDM techniques, SDV (standard deviation) CRITIC (CRiteria Importance Through Intercriteria Correlation), ARAS (Additive Ratio Assessment), MOORA (Multi-objective Optimization on the basis of Ratio Analysis) are applied to analyze the data and measure the performance of the banks. In MCDM techniques, different methods provide different weights of the criteria, and also different ranks are obtained by different methods. Sensitivity analysis was carried out by measuring the criteria weights by SDV and CRITIC and the alternatives are ranked using two MCDM techniques, ARAS and MOORA. The results of the study show that among the private banks, HDFC created a benchmark and leading while Yes bank has shown poor performance on the basis of annual reports of 2020.