Welcome to Open Science
Contact Us
Home Books Journals Submission Open Science Join Us News
Evaluation on the Financial Performance of the Malaysian Banks with TOPSIS Model
Current Issue
Volume 4, 2017
Issue 2 (September)
Pages: 11-16   |   Vol. 4, No. 2, September 2017   |   Follow on         
Paper in PDF Downloads: 110   Since Jul. 23, 2017 Views: 1353   Since Jul. 23, 2017
Authors
[1]
Lam Weng Siew, Department of Physical and Mathematical Science, Faculty of Science, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia; Centre for Mathematical Sciences, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia;Centre for Business and Management, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia.
[2]
Liew Kah Fai, Department of Physical and Mathematical Science, Faculty of Science, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia; Centre for Mathematical Sciences, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia.
[3]
Lam Weng Hoe, Department of Physical and Mathematical Science, Faculty of Science, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia; Centre for Mathematical Sciences, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia; Centre for Business and Management, Universiti Tunku Abdul Rahman, Kampar Campus, Kampar, Perak, Malaysia.
Abstract
Banking sector plays a dominant role in the economies. The financial performance of the banking sector company can be determined by using a multi-criteria decision making model, namely Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS) model. The objective of this study is to evaluate, compare and rank the financial performance of the Malaysian banks in Malaysia stock market with TOPSIS model. The overall financial performance of the companies is determined by six financial ratios. In this study, the data consists of eight Malaysian banks which are listed in Malaysia stock market. The period of study is from year 2011 until 2015. The results of this study show that CIMB Group Holdings Berhad achieves the first ranking, followed by Alliance Financial Group Berhad, AMMB Holdings Berhad, Affin Holdings Berhad, RHB Capital Berhad, Public Bank Berhad, Hong Leong Bank Berhad and Malayan Banking Berhad within the study period. This study is significant because it is able to evaluate, compare and rank the overall financial performance of the Malaysian banks by considering the important and significant financial ratios by using TOPSIS mathematical model.
Keywords
Malaysian Banks, TOPSIS, Optimal Solution, Ranking, Financial Ratios
Reference
[1]
K. B. Tunay and I. Akhisar, “Performance evaluation and ranking of Turkish private banks using AHP and TOPSIS,” Management International Conference, 2015.
[2]
M. Kagioglou, R. Cooper and G. Aouad, “Performance management in construction: A conceptual framework,” Construction Management and Economics, Vol. 19, no. 1, pp. 85–95, 2001.
[3]
H. A. Bassioni, A. D. F. Price and T. M. Hassan, “Performance measurement in construction firms,” Journal of Management in Engineering, Vol. 20, no. 2, pp. 42–50, 2004.
[4]
S. Akkoc and K. Vatansever, “Fuzzy performance evaluation with AHP and TOPSIS methods: Evidence from Turkish banking sector after the global financial crisis,” Eurasian Journal of Business and Economics, Vol. 6, no. 11, pp. 53-74, 2013.
[5]
K. F. Liew, W. S. Lam and W. H. Lam, “Financial analysis on the company performance in Malaysia with multi-criteria decision making model,” System Science and Applied Mathematics, Vol. 1, no. 1, pp. 1-7, 2016.
[6]
B. K. Bulgurcu, “Application of TOPSIS technique for financial performance evaluation of technology firms in Istanbul Stock Exchange Market,” Procedia – Social and Behavioral Sciences, Vol. 62, pp. 1033 – 1040, 2012.
[7]
V. M. Dalfard, A. Sohrabian, A. M. Najafabadi and J. Alvani, “Performance evaluation and prioritization of leasing companies using the super efficiency Data Envelopment Analysis model,” Acta Polytechnica Hungarica, Vol. 9, no. 3, pp. 183-194, 2012.
[8]
W. S. Lam, K. F. Liew and W. H. Lam, “Evaluation on the efficiency of healthcare companies in Malaysia with Data Envelopment Analysis model,” SCIREA Journal of Mathematics, Vol. 1, no. 1, pp. 95-106, 2016.
[9]
S. Hasanloo, E. Karim, M. R. Mehregan and R. Tehrani, “Evaluating performance of companies by new management tools,” Journal of Natural and Social Sciences, Vol. 2, no. 3, pp. 165-169, 2013.
[10]
B. B. Yilmaz and A. M. Konyar, “Financial performance evaluation of publicly held lodging companies listed in Istanbul Stock Exchange with TOPSIS method,” European Journal of Scientific Research, Vol. 95, no. 1, pp. 143-151, 2013.
[11]
W. S. Lam, K. F. Liew and W. H. Lam, “An empirical investigation on the efficiency of healthcare companies with Data Envelopment Analysis model,” Biomedical Statistics and Informatics, Vol. 1, no. 1, pp. 19-23, 2016.
[12]
L. Zamani, R. Beegam and S. Borzoian, “Portfolio selection using Data Envelopment Analysis (DEA): A case of select Indian investment companies,” International Journal of Current Research and Academic Review, Vol. 2, no. 4, pp. 50-55, 2014.
[13]
A. V. Cam, H. Cam, S. Ulutas and O. B. Sayin, “The role of TOPSIS method on determining the financial performance ranking of firms: An application in the Borsa Istanbul,” International Journal of Economics and Research, Vol. 6, no. 3, pp. 29-38, 2015.
[14]
W. S. Lam, K. F. Liew and W. H. Lam, “An empirical comparison on the efficiency of healthcare companies in Malaysia with Data Envelopment Analysis model,” International Journal of Service Science, Management and Engineering, Vol. 4, no. 1, pp. 1-5, 2017.
[15]
B. Bulgurcu, “Financial performance ranking of the automotive industry firmsin Turkey: Evidence from an entropy-weighted technique,” International Journal of Economics and Financial Issues, Vol. 3, no. 4, pp. 844-851, 2013.
[16]
H. Kazan and O. Ozdemir, “Financial performance assessment of large scale conglomerates via TOPSIS and CRITIC methods,” International Journal of Management and Sustainability, Vol. 3, no. 4, pp. 203-224, 2014.
[17]
K. Mandic, B. Delibasic, S. Knezevic and S. Benkovic, “Analysis of the financial parameters of Serbian banks through the application of the fuzzy AHP and TOPSIS methods,” Economic Modelling, Vol. 43, pp. 30-37, 2014.
[18]
C. L. Hwang and K. Yoon, Multiple Attribute Decision Making. Berlin: Springer-Verlag, 1981.
[19]
X. Qin, G. Huang, A. Chakma, X. Nie and Q. Lin, “A MCDM-based expert system for climate-change impact assessment and adaptation planning – A case study for the Georgia Basin, Canada,” Expert Systems with Applications, Vol. 34, no. 3, pp. 2164-2179, 2008.
[20]
Y. Ic, “An experimental design approach using TOPSIS method for the selection of computer-integrated manufacturing technologies,” Robotics and Computer-Integrated Manufacturing, Vol. 28, no. 2, pp. 245-256, 2012.
[21]
G. İşseveroğlu and O. Sezer, “Financial performance of pension companies operating in Turkey with Topsis analysis method,” International Journal of Academic Research in Accounting, Finance and Management Sciences, Vol. 5, no. 1, pp. 137-147, 2015.
[22]
S. Uyun and I. Riadi, “A fuzzy Topsis multiple-attribute decision making for scholarship selection Indonesian,”Journal of Electrical Engineering and Computer Science, Vol. 9, no. 1, pp. 37-46, 2011.
[23]
S. Srikrishna, A. Sreenivasulu Reddy and S. Vani,“A new car selection in the market using TOPSIS technique,” International Journal of Engineering Research and General Science, Vol. 2, no. 4, pp. 177-181, 2014.
[24]
Bursa Malaysia. (n.d.) Company Announcements | Bursa Malaysia Market. [online] Available at: [Accessed 15 December 2016].
[25]
J. E. Price, M. D. Haddock and H. R. Brock, College Accounting. 10th ed., New York, Macmillan/McGraw-Hill, 1993.
[26]
P. Östring, Profit-Focused Supplier Management. United State, American Management Association International, 2003.
[27]
M. K. Ercan and U. Ban, Financial Management. Ankara: Fersa Publication, Gazi Copy Purchaser, 2005
[28]
O. Akguc, Financial Statement Analysis. 13rd ed, Istanbul, Arayis Publication, 2010.
[29]
C. P. Jones, Investments Analysis and Management. 12nd ed., Asia, John Wiley & Sons, 2013.
Open Science Scholarly Journals
Open Science is a peer-reviewed platform, the journals of which cover a wide range of academic disciplines and serve the world's research and scholarly communities. Upon acceptance, Open Science Journals will be immediately and permanently free for everyone to read and download.
CONTACT US
Office Address:
228 Park Ave., S#45956, New York, NY 10003
Phone: +(001)(347)535 0661
E-mail:
LET'S GET IN TOUCH
Name
E-mail
Subject
Message
SEND MASSAGE
Copyright © 2013-, Open Science Publishers - All Rights Reserved