Evaluation of the financial performance of the Turkish banking sector with classical and fuzzy multi-criteria decision-making methods: An application in BIST

The banking sector is an important part of the financial system. Because of the position of the banking sector in the financial system, any negativity that may occur in the banking sector can affect the entire economy of a country. The effective and efficient function of the banking sector, in terms of the duties of distribution of resources and financial mediation, is rather important for the national economy. Therefore, it is of great importance to evaluate the financial performance of banks, which are at critical points in economies. In this study, it was aimed to evaluate the financial performances of 22 banks, which operated in Borsa Istanbul (BIST) from 2009 to 2018, by using the classical and fuzzy multi-criteria decision-making methods. Furthermore, the study, it was aimed to determine the method that stood out from the classical and fuzzy multi-criteria decision-making methods by using the Copeland method. It is believed that the data to be obtained as a result of the analyses in the study will contribute to the financial performance of the Turkish banking sector. In the study, 26 criteria were taken into consideration. The weights of the criteria that were used in the study were calculated by using the Entropy and Fuzzy Shannon Entropy methods. Then, performance analyses were conducted by using the Topsis, Vikor, Fuzzy Topsis, and Fuzzy Vikor methods. The results that were obtained were unified by using the Copeland method and converted into a single ranking. The relationships between the ranking results of the methods and the Copeland method ranking were evaluated by using the Spearman rank correlation test. According to the correlation test, it was observed that the Fuzzy Topsis method stood out among the others. It was determined that the Copeland method and Fuzzy Topsis methods had the highest correlation between α = 0.5 cut-off interval results. Keywords: Entropy, VIKOR and TOPSIS, fuzzy Shannon entropy, fuzzy TOPSIS and fuzzy VIKOR, Copeland method