Title: Efficiency evaluation of state co-operative banks in India: a neural network model and data envelopment analysis

Authors: Triambica Gautam; Amit Srivastava; Shruti Jain

Addresses: Department of Humanities and Social Sciences, Jaypee University of Information Technology, Solan, Himachal Pradesh, India ' Department of Humanities and Social Sciences, Jaypee University of Information Technology, Solan, Himachal Pradesh, India ' Department of Electronics and Communication Engineering, Jaypee University of Information Technology, Solan, Himachal Pradesh, India

Abstract: Cooperative banks are crucial for the stability of the banking sector and to guarantee financial inclusion. Concerns regarding their financials have created an urgent need to analyse their financial condition. Data Envelopment Analysis (DEA) has been extensively used to evaluate commercial banks as it enables efficiency comparisons between a group of decision-making units without the use of predetermined performance benchmarks. Thirty State Cooperative Banks are evaluated here using three distinct DEA models - Cost, Profit and Revenue (CPR). The three efficiency scores obtained are combined using Shannon's entropy to determine an overall efficiency value. This model is validated through the Bayesian Regularisation technique-based Neural Network model evaluation of gradients. Overall rank determined using Shannon entropy and rank determined utilising gradients from neural networks are tested for co linearity using Kendell's tau. The ranks show a high collinearity (coefficient value 0.98) and the relationship is significant at 0.01 level.

Keywords: data envelopment analysis; cooperative banks; efficiency; rank; Shannon entropy.

DOI: 10.1504/IJCM.2025.150315

International Journal of Comparative Management, 2025 Vol.4 No.3, pp.276 - 295

Received: 28 Jan 2023
Accepted: 28 Sep 2023
Published online: 09 Dec 2025 *

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