Prioritizing of Credit Resource Allocation in Sepah Bank Regional Headquarters

Despite the importance of concentration risk, especially in state-owned banks, it does not seem to be a credible method to manage it, to rank the designated areas or credit ceilings. The purpose of this paper is to apply the scientific method of Tansel (2012) to prioritize the credit allocation of Regional Branches Management (RBM) of Sepah Bank using Fuzzy TOPSIS Approach. First, using national and international studies as well as the environmental analysis of the bank, criteria are determined which are weighted by the bank experts and translated from linguistic scale to triangular fuzzy numbers. In the final stage, Fuzzy TOPSIS method is used to rank RBMs. In this study, data on 40 RBMs and independent branches of Sepah Bank (16 benchmarks) are collected and Fuzzy TOPSIS technique is applied to rank the weighted RBMs. The results show that, among criteria used, the most important criteria are cheap deposit ratios, per capita profits and the target deposit rates. Branches Management of Hormozgan region has taken the highest weight and those of north Tehran and Khuzestan are ranked next, respectively. Free Trade-Industrial Zones branch Management has taken the minimum weight (the lowest ceiling facility).