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Measuring bank operations performance: an approach based on Grey Relation Analysis

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  • Chien-Ta Ho

    (Institute of Electronic Commerce, National Chung Hsing University)

Abstract

The aim of this paper is to use a new approach of performance evaluation, Grey Relation Analysis (GRA), which is a concept borrowed from the study of industry and increasingly applied to commerce. GRA is used to evaluate the relative performance of three investment Taiwanese trust firms, which have been reorganized into banks. The result of the study indicates that although the sample size is small and the distribution of data is unknown, GRA can still be successfully used in evaluating bank performance. In addition, this paper compares the GRA results with the Financial Statement Analysis (FSA) and shows that the same result can be obtained.

Suggested Citation

  • Chien-Ta Ho, 2006. "Measuring bank operations performance: an approach based on Grey Relation Analysis," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 57(4), pages 337-349, April.
    • Handle: RePEc:pal:jorsoc:v:57:y:2006:i:4:d:10.1057_palgrave.jors.2601985
    DOI: 10.1057/palgrave.jors.2601985
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    References listed on IDEAS

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    1. Chien-Ta Ho & Kim Hua Tan, 2004. "Measuring operational efficiency: an approach based on the data envelopment analysis," International Journal of Management and Enterprise Development, Inderscience Enterprises Ltd, vol. 1(2), pages 120-135.
    2. Feng, Cheng-Min & Wang, Rong-Tsu, 2000. "Performance evaluation for airlines including the consideration of financial ratios," Journal of Air Transport Management, Elsevier, vol. 6(3), pages 133-142.
    3. Lawrence M. Seiford & Joe Zhu, 1999. "Profitability and Marketability of the Top 55 U.S. Commercial Banks," Management Science, INFORMS, vol. 45(9), pages 1270-1288, September.
    4. E H Feroz & S Kim & R L Raab, 2003. "Financial statement analysis: A data envelopment analysis approach," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 54(1), pages 48-58, January.
    5. West, Robert Craig, 1985. "A factor-analytic approach to bank condition," Journal of Banking & Finance, Elsevier, vol. 9(2), pages 253-266, June.
    6. Espahbodi, Pouran, 1991. "Identification of problem banks and binary choice models," Journal of Banking & Finance, Elsevier, vol. 15(1), pages 53-71, February.
    7. Coleen C. Pantalone & Marjorie B. Platt, 1987. "Predicting commercial bank failure since deregulation," New England Economic Review, Federal Reserve Bank of Boston, issue Jul, pages 37-47.
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    Cited by:

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    2. Mokhamad Anwar, 2010. "Cost Structure In Indonesian Islamic Banks: (Case on PT. Bank Syariah Mandiri and PT. Bank Syariah Mega Indonesia)," Working Papers in Business, Management and Finance 201008, Department of Management and Business, Padjadjaran University, revised Aug 2010.
    3. Mokhamad Anwar, 2010. "Cost Components as Predictors for the Profitability of sharia Banks : (Study on PT. Bank Syariah Mandiri and PT. Bank Syariah Mega Indonesia)," Working Papers in Business, Management and Finance 201009, Department of Management and Business, Padjadjaran University, revised Sep 2010.
    4. Memić Deni & Škaljić-Memić Selma, 2013. "Performance Analysis and Benchmarking of Commercial Banks Operating in Bosnia and Herzegovina: a DEA Approach," Business Systems Research, Sciendo, vol. 4(2), pages 17-37, December.
    5. Mokhamad Anwar, 2010. "Small Business Financing and Bank Performance : Empirical Study of Indonesian Publicly Banks," Working Papers in Business, Management and Finance 201010, Department of Management and Business, Padjadjaran University, revised Oct 2010.
    6. Chengxiu Ling & Jiayi Li & Yixuan Liu & Zhiyan Cai, 2021. "Extremal Analysis of Flooding Risk and Management," Papers 2112.00562, arXiv.org.
    7. C-T Bruce Ho, 2011. "Measuring dot com efficiency using a combined DEA and GRA approach," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 62(4), pages 776-783, April.

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