Financial performance analysis of participation banks in Turkish banking sector: An application using Entropy, VIKOR and TOPSIS methods

The banking sector, with its intermediary role in the financial system, contributes to the development of the real sector and constitutes one of the important building blocks of the country's economy. Participation banks in the banking sector such as deposit banks It aims to reduce costs and increase profits while trying to provide the best service to its customers in an intense competitive environment. It is important to successfully conduct financial performance management in order to achieve the sustainable growth targets of participation banks. The aim of our thesis is to analyze the financial performances of participation banks operating in the Turkish banking sector by using 22 profitability and cost ratios, using entropy, TOPSIS and VIKOR methods, which are among the multi-criteria decision making techniques. In the implementation phase, 6 main criteria were determined from the most used asset ratio, capital adequacy, liquidity, balance sheet structure, income-expense structure and profitability ratios as a result of the literature research, and the main criterion and sub criterion weights were determined by the Entropy method. After determining the criterion weights, performance evaluations of participation banks by years were made using TOPSIS and VIKOR methods. In our study, the performances of 2 state-owned and 3 private-capital participation banks operating between 2017-2019 were evaluated. Keywords: Banking, Participation Banks, Entropy, TOPSIS and VIKOR