Optimization on the financial management of the bank with goal programming model

Abstract

Financial management is crucial for planning bank’s asset and liabilities while taking
consideration for multiple objectives. The objective of this study is to develop a Goal
Programming (GP) model to optimize the financial management of Public Bank Berhad in
Malaysia. Six goals from the financial statements namely total asset, total liability, total equity, profit, earning and optimum management items are investigated for the period from 2011 to 2015. The results of this study indicate that all six goals are fully achieved by using the GP model. This study is significant because it helps to develop a mathematical model to examine the financial strengths of Public Bank Berhad in Malaysia. Besides that, the potential improvement on liability, equity, profit, earning and optimum management item of Public Bank Berhadcan be identified in this study based on the deviation from the target value.

Keywords: Asset; Liability; Equity; Profit; Earning; Optimum Management Items