British Journal of Research Open Access

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Abstract

A Hybrid Approach of DEA and Multivariate Regression Analysis for Performance Measurement of Nationalized Indian Banks

Bhagat Kishanrao Gayval and Vishnudas Bajaj

Objective: The main objective of this paper is developing new hybrid model of CCR model and BCC model of DEA as non-parametric technique with Multiple Regression Analysis as parametric technique to ranking Nationalised Banks of India. We have verified ranking results obtained through three methods with Statistical test as non-parametric test.
Research Methods: In this paper we have applied Data Envelopment techniques such as input oriented Constant Returns to Scale model and input oriented Variable Returns to Scale model. These models integrated with Multiple Regression Analysis technique for ranking Indian Banks. Also these obtained results have been verified using Spearman’s Rank Correlation test.
Results: In this study, 20 Nationalised banks are selected to identify the ranking of each banks using above mentioned three methodologies. The results indicate that the Bank of Baroda, Punjab National Bank and IDBI Bank Ltd are efficient frontier banks out of 20 banks using DEA models. As per methodology of Statistical Multivariate Regression Analysis, the Bank of Baroda, IDBI Bank Ltd and Punjab National Bank were getting first, second and third rank respectively.
Conclusion: We have concluded that the CCR model, BCC model and Multiple Regression Analysis techniques are positively correlated with each other as per Spearman’s rank correlation test result.