Financial performance measurement of private banks in Turkey: using TOPSİS and PROMETHEE methods

In their great history, which dates back to the B.C. 18th century, banks havegrown till nowadays and have become essential institutions of the economic system. Increasing the number of players in the rapidly developing banking sector and the development of technology have caused the competitive environment. These conditions require that the banks make right decision about usage their sources in effective and efficient way. The right way for banks to make the right decisions and determine the right strategies is to measure their performance correctly. Among the methods used in financial performance measurement, Multi-Criteria Decision Making (MCDM) methods have an important place. In this study, after giving detailed information about banking concept, historical process and functions, Multi-Criteria Decision Making methods are explained. In addition, financial ratios have been calculated set of financial statements of private banks established in Turkey. Using these ratios, financial performance of banks was measured by TOPSIS and PROMETHEE methods. Key Words: Financial Performance Measurement, Multi Criteria Decision Making Methods, TOPSIS, PROMETHEE, Private Banking