an encoder and decoder for improving bit rate efficiency in a wavelet based codec includes an analysis filter bank for decorrelating the input data signal . a set of decimators are used to down sample the filtered input data signal and a predictor is used to extract cross subband dependence . the predictors are used in order to reduce the number of bytes of an encoded input data signal x . the predictors exploit existing correlation amongst the subbands resulting from a multi - level analysis wavelet transformation or filter bank processing . decimation required by the analysis filter bank is placed around the predictor on the basis of spatial location variance minimization to further facilitate subband prediction , and on computational complexity of the overall system .