A fuzzy AHP and DEA approach for making bank loan decisions for small and medium enterprises in Taiwan

H., Z.; Wang, H. S.; Chuang, Chih-Ling

doi:10.1016/j.eswa.2010.04.010

Cited by 55 publications

(33 citation statements)

References 13 publications

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“…Applying a fuzzy analytical hierarchy process and computing Value at Risk (VAR for short) showed that the efficient selection of loan applicants can reduce credit risk by 80% [5]. By utilizing Meta-heuristic approach in the field of assessing financial risk, Che et al [6] stated that while there is a strong competition between Taiwan financial institutions and banks, high proportion of outstanding deposits can be observed over the loaning systems particularly on small and medium companies in Taiwan. Many warning systems, designed for commercial loans risk, are usually composed of artificial neural network and the concept of traditional warning.…”

Section: Literature Reviewmentioning

confidence: 99%

Credit Risk Assessment Utilizing Data Reduction Technique for Individual Loaning in Financial Institutes (Case Study: Tejarat Bank, Rasht, Iran)

Mahmoudabadi¹,

Mehrshad²,

Amin-Naseri³

2017

AJTAB

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Abstract:Because of the nature of the financial and economic activities and they are practically accompanied with a degree of risk., banks are usually dealing with many risks, including operational, marketing, interest rate, etc. Since, credit risk has significant effects on financial banks activities in terms of loaning profits, the risk of repayment individual loans has been investigated in this research work. Two well-known regression models of Probit and Logistic have been developed based on nine extracted factors which have been investigated during the offering of loans according to the possibility of late or nonrepayment. In order to minimize inter-correlation and extracting high-independency factors, the statistical technique of Principal Component Analysis (PCA), categorized as a data reduction technique, has been utilized and three factors out of nine have been omitted. One of Tejarat bank branches in the Iranian Northern Province of Guilan has been selected as case study to gather experimental data for assessing the credit risk of individual bank investors. The results of model validation revealed that the implementation of PCA method can improve the accuracy of models' outputs and Probit regression model has better results rather than Logit one.

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Section: Literature Reviewmentioning

confidence: 99%

Credit Risk Assessment Utilizing Data Reduction Technique for Individual Loaning in Financial Institutes (Case Study: Tejarat Bank, Rasht, Iran)

Mahmoudabadi¹,

Mehrshad²,

Amin-Naseri³

2017

AJTAB

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“…DEA was also applied for banking decisions. For instance, Che et al (2010) implemented a combination of Fuzzy analytical hierarchy procedure (AHP) and DEA as a decision making facility for making bank loan decisions.…”

Section: Introductionmentioning

confidence: 99%

A DEA-TOPSIS approach for ranking credit institutions

Ehsani¹,

Danaei²

2014

10.5267/j.msl

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Measuring the relative efficiency of financial units plays essential role for making strategic decisions such as business development, downsizing, etc. This paper presents an empirical investigation to rank different branches of a credit institution named Samen in city of Semnan, Iran. The proposed study uses data envelopment analysis (DEA) for measuring the relative efficiency of 17 units. The results indicate that five units were efficient and using Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS), the efficient units are ranked based on some inputs/outputs. The results of this study indicate that most branches of this financial unit performed poorly and a restructure in their businesses is necessary. In addition, the study has provided some evidences that considering employee wage, bank deposit and administration expenses as inputs for DEA implementation seems to provide better results than using total assets and equities.

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“…The integrated DEA and AHP has been widely used among many researchers. For instance, Che et al (2010) implemented an integration of Fuzzy analytical hierarchy procedure (AHP) and DEA as a decision making facility for making bank loan decisions.…”

Section: Introductionmentioning

confidence: 99%

A robust AHP-DEA method for measuring the relative efficiency: An application of airport industry

Foroughi¹,

Esfahani²

2012

MSL

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Measuring the relative efficiency of similar units has been an important topic of research among many researchers. Data envelopment analysis has been one of the most important techniques for measuring the efficiency of different units. However, there are some limitations on using such technique and some people prefer to use other methods such as analytical hierarchy process to measure the relative efficiencies. Besides, uncertainty in the input data is another issue, which makes some misleading results. In this paper, we present an integrated robust DEA-AHP to measure the relative efficiency of similar units. The proposed model of this is believed to capable of presenting better results in terms of efficiency compared with exclusive usage of DEA or AHP. The implementation of the proposed model is demonstrated for a real-world case study of Airport industry and the results are analyzed.}}

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A fuzzy AHP and DEA approach for making bank loan decisions for small and medium enterprises in Taiwan

Cited by 55 publications

References 13 publications

Credit Risk Assessment Utilizing Data Reduction Technique for Individual Loaning in Financial Institutes (Case Study: Tejarat Bank, Rasht, Iran)

Credit Risk Assessment Utilizing Data Reduction Technique for Individual Loaning in Financial Institutes (Case Study: Tejarat Bank, Rasht, Iran)

A DEA-TOPSIS approach for ranking credit institutions

A robust AHP-DEA method for measuring the relative efficiency: An application of airport industry

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