Retail Banking

The present paper presents the methodology and the main results of a quantitative study applied on a sample of 1010 respondents, in the Romanian banking industry. The aim of the study was to research the customer level of loyalty toward Romanian organizations acting in the retail banking sector. According to similar researches in the field, loyalty is a complex construction, which comprises both psychological and behavioural components, fact also proved by the results of the present research. As the survey results show, Romanian customers remain in relationships with banks due to the existence of both favourable attitudes or positive motivations (representing 46,36% of the total retention motivations) and constraint factors or inertia (representing 52,44% of the total retention motivations). At the same time, the results prove that the level of loyalty stated by customers is supported not only by the level of satisfaction, but also by factors like: bank's attitude towards its own customers, the level of customer trust toward the organization or its employees in ensuring the financial interests of clients, and also by the level of customer commitment. Customer switching behaviour is determined in 58% of cases by the high level of dissatisfaction toward the banks' policy of price.

Designers of cryptographic systems are at a disadvantage to most other engineers, in that information on how their systems fail is hard to get: their major users have traditionally been government agencies, which are very secretive about their mistakes.

The growth of variable pay schemes (VPS) appears to threaten collective approaches to pay determination, which are based on standardization and centralization. This article utilizes case study research to analyse the still little-known relationship between collective bargaining and VPS. It focuses on the retail banking sector, where trade union representation and collective bargaining remain relatively robust. The research identifies an emergent process whereby the growth of bonus schemes has both supplanted collective profitshare and permitted greater standardization of merit-pay awards. Unions have therefore achieved some success in terms of limiting variation in base pay, at the same time as the overall purchase of collective bargaining on employee earnings has diminished. The factors contributing to this development are explained.

The paper presents model based on fuzzy methods for churn prediction in retail banking. The study was done on the real, anonymised data of 5000 clients of a retail bank. Real data are great strength of the study, as a lot of studies often use old, irrelevant or artificial data. Canonical discriminant analysis was applied to reveal variables that provide maximal separation between clusters of churners and non-churners. Combination of standard deviation, canonical discriminant analysis and k-means clustering results were used for outliers detection. Due to the fuzzy nature of practical customer relationship management problems it was expected, and shown, that fuzzy methods performed better than the classical ones. According to the results of the preliminary data exploration and fuzzy clustering with different values of the input parameters for fuzzy cmeans algorithm, the best parameter combination was chosen and applied to training data set. Four different prediction models, called prediction engines, have been developed. The definitions of clients in the fuzzy transitional conditions and the distance of k instances fuzzy sums were introduced. The prediction engine using these sums performed best in churn prediction, applied to both balanced and non-balanced test sets.

The UK retail banking sector in the recent years has witnessed a significant transformation in service delivery due, in large part, to the advancement in technology and innovations. Many on-site banking services are now delivered through technology-based service delivery channels such as Self-Service Kiosks and Automat- ed Teller Machines. The quality of services offered by retail banks plays a key role in enhancing their market competitive positions. This paper proposes a hybrid approach for measuring qualities of traditional and automated on-site retail banking services. The authors carried out a comprehensive chronological review of literature, 36 papers, in service quality and service excellence, marketing and related topics. The review found a lack of distinctive frameworks for measuring on-site banking services delivered through traditional and automated channels. The authors evaluated—and diligently revised—the existing main models for measuring the quality of services in the...

The intangibility of banking services makes the evaluation of service quality and customer convenience difficult to measure. Bankers obviously recognize the importance of intangible factors, but because of pressures placed on operating margins caused by the current economic climate and chronically low margins, the evaluation of factors related to quality service becomes paramount for bank managers. Bankers, by necessity, seek to promote improvement initiatives, which will assist banks in improving their perceived costumer portfolio quality. This paper aims to construct an integrated evaluation system for retail banking service quality and convenience at the bank branch level. By combining cognitive mapping with measuring attractiveness by a categorical based evaluation technique, we strive to introduce transparency in the decision making process and add to the performance literature in retail banking. Strengths, weaknesses and practical applications of our multiple criteria evaluation system are also discussed.

Introduction This paper's purpose is to illustrate the relationship of profitability to intermediate, customer-related outcomes that managers can influence directly. It is predominantly a general management discussion, consistent with the Nordic School's view that services are highly interdisciplinary, requiring a "service management" approach (see Grönroos, 1984, 1991). Its findings support the theory that customer satisfaction is related to customer loyalty, which in turn is related to profitability (Heskett et al., 1994, and discussed in Storbacka et al., 1994). While this theory has been advocated for service firms as a class, this paper presents an empirical analysis of one retail bank, limiting the findings' generalizability. The service profit chain (Heskett et al., 1994) hypothesizes that: Customer satisfaction-> customer loyalty-> profitability. The research presented here, while unable to demonstrate causality because of its reliance on OLS regression of cross-sectional data, does illustrate that customer satisfaction, customer loyalty, and profitability are related to one another. Thus: Customer satisfaction <-> customer loyalty <-> profitability. To this end, this research examined two hypotheses: H1: Customer satisfaction is related to customer loyalty. H2: Customer loyalty is related to profitability. This research intentionally focuses at a relatively high level of abstraction in an effort to contribute to the growing body of theoretical and empirical knowledge on the relationships among customer satisfaction, customer loyalty, and profitability (see

This study examines the effects of customer orientation and servant leadership on frontline employees' burnout and, subsequently, on their turnover intentions. Also investigated in the study is the intervening role of person-job fit in the process. Data collected from 530 frontline bank employees in New Zealand serve as the study setting. Results show that both customer orientation and servant leadership significantly reduce burnout and ultimately turnover intentions. Results also show that person-job fit mediates the influences of customer orientation and servant leadership on burnout and turnover intentions. Implications of the results are discussed and future research avenues are offered.

South African retail banks, like retail banks elsewhere in the world, are investing significant amounts of capital into the provision of e-banking services in the hope that this will translate into higher returns and market penetration. However, the rapid adoption of these e-banking services is still in doubt. Any strategy aimed at achieving widespread adoption and use of these e-banking services rests on solid understanding of factors that influence customers’ adoption and use of the services. This study adds trust in the e-banking system, customer awareness of e-banking services and perceived self-efficacy, together with the TAM constructs of perceived usefulness and ease of use to improve the understanding of the predicators of Internet and cellphone banking services adoption in South Africa. For this study, a cross-sectional descriptive survey design was used to obtain data from 394 customers of the four major retail banks in South Africa through self-administered questionnaires...

Purpose – In many industries, perceived service value is found to be a significant mediator between perceived service quality and customer satisfaction and loyalty. Therefore, this paper aims to test a conceptual model of perceived service value with its antecedents, such as perceived price and perceived service quality, and consequences, customer satisfaction and loyalty, in the retail banking industry.
Design/Methodology/Approach – For the empirical study, a measurement instrument was developed and tested for validity and reliability. Measures were assessed with exploratory factor analysis (EFA), confirmatory factor analysis (CFA) and structural equation modeling (SEM). A structural model with five reflective constructs was evaluated to test direct and indirect relationships among constructs.
Findings and implications – Results confirm a mediating role of perceived value in relationships between perceived price, perceived service quality, customer satisfaction, and customer loyalty in the case of retail banking services.
Limitations – Because the results are directly relevant only to customers and marketing managers of retail banking services, generalizations of the findings beyond the immediate population observed should be made with caution.
Originality – This paper extends existing knowledge with both direct and indirect effects among researched concepts, and shows the importance of perceived service value in achieving satisfied and loyal customers in retail banking services.

Against a background of far-reaching structural change in the banking sector, this article reviews the recent academic literature on developments in European banking. European banking markets have become increasingly integrated in recent years, but barriers to full integration, especially in retail banking, still remain. European integration has possible implications for systemic risk, and poses various challenges for the current supervisory framework. The banks' responses to the changing competitive environment include the pursuit of strategies of diversification, vertical product differentiation and consolidation. European integration has implications for competition in banking markets, for the nature of long-term borrower-lender relationships, and for the relationships between ownership structure, technological change and bank efficiency. The article concludes by reviewing recent literature on the credit channel in the monetary transmission mechanism, and interest rate pass-through.

An end-to-end workflow analysis tightly coupled with a dashboard reporting approach provides management with a capability for quick assessment of a changing environment and the ability to achieve the highest payback levels. In addition, the service facility can be organized around customer segments, as dictated by customer profitability guidelines.  An end-to-end workflow defines, illustrates and graphically demonstrates how retail banking operations quantitatively supports numerous productivity improvement ideologies.

It's a statistical model for account prospecting in retail banking. The model recommends optimal mixtures of assets and liability products that maximizes profitablilty. Developing a new product mix is the most challenging part of an account prospecting analysis, as it involves improvising the account prospecting strategy to change the existing paradigm.

As economic globalization intensifies competition and creates a climate of constant change, winning and keeping customers has become all the more important. Nowadays banks have realized that cost of attracting a new customer is much more than retaining existing customers, so banks are emphasizing more upon customer satisfaction. These days customers demand for top quality services and products served with minimum wait time, so customers prefer techno-savvy banks as well bankers. At this backdrop, the main problem today before the commercial banks, more particularly the public sector banks in India which were earlier operating in a sheltered regime after nationalization, is their long-run survival, tapping quality customers and forging way ahead by retaining their valued customers. The current research paper attempts to make a comparative analysis of level of customer satisfaction towards services provided by public and private sector banks. The study has been conducted in Chandigarh city. This study is based on questionnaire method. A sample of 160 customers has been selected using convenient sampling method. The statistical tests are conducted at 5% and 1% level of significant the main statistical tools are used. This study concluded that private sector banks are more preferred by majority of the customer as they emphasize more upon relationship building with their clients and are better equipped with modern infrastructure as compared to public sector banks.

Data envelopment analysis (DEA) is an ideal tool to assess a bank branch's operating and profit efficiency. This study went a step further to also explore the impact of IT-based retail banking services on branch efficiency, and found that IT-based transactions at the branch level have a significant impact on profit efficiency, and therefore have a significant role to play in profit maximization. Improving bank branch technology to best support service delivery is also a practical way to achieve greater efficiency, which in turn, contributes to a commercial bank's overall profitability.

Purpose -The purpose of this study is to investigate the effects of work-family conflict, emotional exhaustion, and intrinsic motivation on front-line employees' job performance, job satisfaction, and affective organizational commitment in Turkish retail banks as its setting. Design/methodology/approach -A total number of 363 usable questionnaires were personally retrieved from front-line employees in the research location. The relevant writings were canvassed in order to design the survey instrument. The hypothesized relationships were tested using LISREL 8.30 through path analysis. Findings -Results reveal that work-family conflict increased emotional exhaustion and decreased job satisfaction. Intrinsic motivation was found to exert a significant negative impact on emotional exhaustion. Results demonstrate that high levels of intrinsic motivation resulted in high levels of job performance, job satisfaction, and affective commitment to the organization. The empirical results also indicate that emotional exhaustion exerted a significant negative effect on job satisfaction. As hypothesized, high levels of job performance led to increased job satisfaction. However, work-family conflict and emotional exhaustion did not have any significant effects on job performance and affective organizational commitment. As expected, the empirical results provided support for the significant positive effects of job performance and job satisfaction on affective organizational commitment. Research limitations/implications -Job performance was operationalized via self-report measure. In future research, incorporating non-work variables such as family, leisure and life satisfaction into the research model would shed further light on one's understanding about the relationships of work-family conflict and emotional exhaustion with those variables. Practical implications -Top managements of banks should be committed to establishing and maintaining family-supportive work environments. By doing so, properly trained bank managers can create a culture that helps front-line employees balance work requirements with non-work responsibilities. In addition, these managers should provide ongoing training programs, which aim to teach front-line employees how to manage time effectively and resolve problems associated with work-family conflict and emotional exhaustion. Originality/value -The present study makes useful additions to the current knowledge base by investigating the effects of work-family conflict and intrinsic motivation on emotional exhaustion and the effects of work-family conflict and emotional exhaustion on various job outcomes of front-line bank employees in a developing economy.

The study explores the various facets of
different wave retail banking models, including their
merits, demerits are security issues, to share the wave
retail wave banking implementation in Bangladesh.
Apart from that, this research evaluates the current
status and preparedness of banks to facilitate wave
retail banking in Bangladesh. To developed smooth
operation and application of wave retail banking in
Bangladesh. This research focuses only on renown
Banks in Bangladesh. This trend contributes towards
the anticipated growth of wave financial information
services, funds transfer, bill payment and
presentation, account management and customer
service solutions. Therefore, this research use the
Unified Theory of Acceptance and Use of Technology
(UTAUT). Also, To conduct the study primarily as well
as secondary data have been collected 100 users of the
bank account holder in Dhaka city were interviewed to
know about their interest about cashless wave banking
in the retail market. In order to analyze the data, we
use SPSS for pilot test and PLS for data analysis. The
elaborate the current wave retail executing
infrastructure of Bangladesh. Also, understand the
awareness and readiness of customers satisfaction
regarding wave retail banking in retail market supply
chain management. This study creates a sensation
among the bank and consumer satisfaction in the use
of wave retail banking.

As economic globalization intensifies antagonism and makes an environment of constant transform, winning and keeping customers has become all the more significant. Nowadays banks have realized that cost of attracting a new customer is much more than retaining existing customers, so banks are emphasizing more upon customer satisfaction. These days customers demand for top quality services and products served with minimum wait time, so customers prefer techno-savvy banks as well bankers. At this backdrop, the main problem today before the commercial banks, more particularly the public sector banks in Bangladesh which were earlier operating in a sheltered regime after nationalization, is their long-run survival, tapping quality customers and forging way ahead by retaining their valued customers. The current research paper attempts to make a comparative analysis of level of customer satisfaction towards services provided by public and private sector banks. The study has been conducted in 5 cities. This study is based on questionnaire method. A sample of 500 customers has been selected using convenient sampling method. The statistical tests are conducted at 5% and 1% level of significant the main statistical tools are used. This study concluded that private sector banks are more preferred by majority of the customer as they emphasize more upon relationship building with their clients and are better equipped with modern infrastructure as compared to public sector banks.

W hat can service firms do to improve their ability to offer new services? In this paper we argue that new service development success results from building a competence in the management of service development resources and routines. We conceptualize new service development competence as a multidimensional, secondorder latent construct that is represented by a system of four interrelated and complementary dimensions: (1) formalized new service development processes, (2) market acuity, (3) new service development strategy, and (4) information technology use and experience. We hypothesize that the growth of new service development competence is related to improved new service development performance. Using structural equations modeling, we analyze survey data from 166 retail banks and report three key empirical findings. First, we show that the four hypothesized dimensions are statistically significant in defining new service development competence. Second, contrary to conventional wisdom in new product development, we find that formalized processes play a lesser role in the success of new service development compared with the other three dimensions. Instead, market acuity-which captures the firm's ability to see the competitive environment clearly and to anticipate and respond to customers' evolving needs and wants-was the most important new service development competence indicator. Finally, we demonstrate the positive effect of new service development competence on new service development performance and show that new service development competence is also significantly related to business-level performance. Together, our empirical results suggest that complementary benefits arise from the adoption of a more holistic approach to the management of new service development at the program level.

This article provides a rich description of Banco Santander's transformation from a medium-sized Spanish bank to one of the world's biggest and most profitable banks. This internationalisation has been distinguished not just by its speed and scale, but also by its profitability and creation of shareholder value: a stark contrast to the disappointing outcomes of trans-border ventures at many other banks. We identify a systematic pattern in Banco Santander's international growth that we conceptualize as a three step process: first, building capabilities in the home market; second, creating growth options in foreign markets through small-scale acquisitions or strategic alliances; third, large-scale foreign market entry and rapid integration. We identify three features of Banco Santander's international strategy which can offer useful guidance to other financial service firms. First, the importance of basing international expansion on superior home-based organisational capabilities; second, the merits of an exploratory approach to learn about new markets and assess potential acquisition targets; third, the value of transferring home base capabilities through cross-border integration of new acquisitions into the existing international network. While the pattern of its internationalisation differs from those of manufacturing firms, Santander's strategy is consistent with two key features of the Uppsala model: increasing commitment to foreign markets incrementally, and entering foreign markets sequentially, starting with those with close cultural and/or economic proximity to the home country.

Cell phone usage has grown phenomenally in Africa, and particularly in South Africa where initial growth forecasts have been greatly exceeded. This technology therefore provides opportunities for services such as banking to reach critical mass. All major retail banks in South Africa provide cell phone banking, but very few customers actually use it. This study examines the factors that influence the adoption of cell phone banking in South Africa, as a means of understanding how to possibly increase the rate of adoption. A framework developed in Singapore identifying factors influencing the adoption of Internet banking was used as a basis, and amended to assess cell phone banking. Factors identified as influences included relative advantage, trialability, and consumer banking needs, with perceived risk having a major negative influence. r

Purpose -The purpose of this research is to examine different customer satisfaction and loyalty metrics and test their relationship to customer retention, recommendation and share of wallet using micro (customer) level data. Design/methodology/approach -The data for this study come from a two-year longitudinal Internet panel of over 8,000 US customers of firms in one of three industries (retail banking, mass-merchant retail, and Internet service providers (ISPs)). Correlation analysis, CHAID, and three types of regression analyses (best-subsets, ordinal logistic, and latent class ordinal logistic regression) were used to test the hypotheses. Findings -Contrary to Reichheld's assertions, the results indicate that recommend intention alone will not suffice as a single predictor of customers' future loyalty behavior. Use of a multiple indicator instead of a single predictor model performs better in predicting customer recommendations and retention.

During the past few years, with the use and availability of the internet exponentially increasing, many sectors, including banking, undergo a rapid and often abrupt change in the way they operate. Technological innovations, along with changes to the preferences of the modern customer open up the way to a digitalised world. Banking services and delivery channels go through an enormous shift from traditional non-digitalised processes supported by bank employees, to fully online and self- serviced; rendering physical branches and employees vastly redundant. This research aims to examine this evolution by analysing the technological and sociological factors that have contributed to it, including advances in mobile telephony and online data management, as well as customer trends of reducing visits to physical branches and liaising with bank employees.

This thesis further illustrates how, with the use of cloud technology, big data analysis and internet of things devices, the transformation of financial institutions fostered the rise of tech-savvy start-ups, which are widely known as fintech companies. It also examines the effort made by traditional banking institutions to catch up with this new environment, by introducing mobile banking services that substitute their physical services. This thesis will also analyse some of the novel services provided by these start-ups including new ways of account management, mobile payments and wallets, cryptocurrency trading, P2P lending, AI robots, etc. Lastly, this research analyses the demographic characteristics of the customers adopting these novel services, as well as the regulations applied in the EU and UK in which financial and non-financial institutions operate in.

The research concludes that the future of banking is characterised by innovative services and products offered online which, however, would need to be supported by a regulatory framework, able to eliminate entry barriers for newcomers in the banking sector.

This paper addresses the problem of interaction design for service provision to customers in a multi-platform environment. It is based on a qualitative and quantitative study of a Portuguese multi-channel retail bank, and shows that, as most of the financial operations are functionally available across the different service platforms, experience requirements become increasingly influential in customers' usage of the different channels. Different financial services generate different interaction needs, and the fit between experience requirements and channel performance in satisfying those needs has a strong impact on customer channel choices. Based on these findings, essential use cases are applied and extended to capture experience requirements for the different financial operations in a technology independent way. With this approach, interaction designers can identify which platforms are best suited to provide the different services available, improving the multi-channel service as a whole. On the other hand, it also enables the identification of areas of interaction experience that need improvement in each platform, if services offered are likely to be effectively used.

Describes a study performed in Canada to develop a reliable and valid scale for the measurement of the perceived service quality of bank services. A sample of retail banking customers was questioned. The proposed scale is called banking service quality (BSQ) and comprises 31 items which span six dimensions: effectiveness and assurance; access; price; tangibles; services portfolio and reliability.

Customer churn is an ever-growing issue in the relational services sector (e.g., retail banking, telecommunications), where business models ultimately depend upon long-term relationships with customers as the basis for profitability. Businesses in this sector have tended to view satisfaction and service quality as the key tools for increasing customer retention. The present study investigates the important additional role of the brand in managing the churn of current customers of relational services. Based on information economics, we propose specifically that the credibility of the brand underlies the role that the brand can play in this process. This research leads to the enhanced understanding that the brand has a significant role to play in managing long-term customer relationships, and details how the usual tools of customer relationship management, satisfaction and service quality, relate to brand credibility. Results from samples of retail bank and long distance telephone company customers indicate that brand credibility serves in a defensive role: it significantly enhances word-of-mouth and reduces switching behaviors among customers; these relationships are mediated by customer satisfaction and commitment. Implications of the study for theory and practice are discussed. r

By employing a multi-stage, multi-phase, and multi-sample approach, this paper reports on the construction of a service quality scale. Customer perceptions of service quality of retail banks in Northern Cyprus serve as the study setting. The parsimonious 20item four-dimensional scale consisting of service environment (four items), interaction quality (seven items), empathy (five items), and reliability (four items) exhibits sound psychometric properties. Scale development procedures and managerial applications of the derived scale are discussed. r

This study investigates the banking behavior of retail banking customers in Chennai. By collecting a data from a sample of 324 customers of retail banks convenience sampling was adopted for collecting a sample. A researcher conducted a comprehensive profile analysis, a number of ANOVA, t test and factor analysis used for finding the banking behaviors of retail banking customers. First, most of the customers fall in the age group of 18-30 years and they are highly educated and have durable relations hip with the banks. Age and income of the respondents have a significant role in the customer preference for selecting a bank and in the gender does not influence the customers for preferences of banks.

This article considers the development of relationship marketing in retail financial services. It begins by examining the relationship marketing literature and considering its application to the retail banking industry. Following a discussion of the research methodology, four in-depth retail bank case studies are presented. These cases form the basis of a qualitative analysis of the state of relationship marketing in retail banking. Many banks have already reached a higher level of relationship marketing than businesses in other sectors. Yet generic relationship marketing models such as the one applied in this research do not necessarily reflect these differences. A modified version of a relationship marketing model, which caters for the particular characteristics of retail banks and which may be applicable to other services businesses, is therefore proposed.

Written by an international assembly of distinguished philosophers, the Blackwell Philosophy Guides create a groundbreaking student resource -a complete critical survey of the central themes and issues of philosophy today. Focusing and advancing key arguments throughout, each essay incorporates essential background material serving to clarify the history and logic of the relevant topic. Accordingly, these volumes will be a valuable resource for a broad range of students and readers, including professional philosophers.

As economic globalization intensifies antagonism and makes an environment of constant transform, winning and keeping customers has become all the more significant. Nowadays banks have realized that cost of attracting a new customer is much more than retaining existing customers, so banks are emphasizing more upon customer satisfaction. These days customers demand for top quality services and products served with minimum wait time, so customers prefer techno-savvy banks as well bankers. At this backdrop, the main problem today before the commercial banks, more particularly the public sector banks in Bangladesh which were earlier operating in a sheltered regime after nationalization, is their long-run survival, tapping quality customers and forging way ahead by retaining their valued customers. The current research paper attempts to make a comparative analysis of level of customer satisfaction towards services provided by public and private sector banks. The study has been conducted in 5 cities. This study is based on questionnaire method. A sample of 500 customers has been selected using convenient sampling method. The statistical tests are conducted at 5% and 1% level of significant the main statistical tools are used. This study concluded that private sector banks are more preferred by majority of the customer as they emphasize more upon relationship building with their clients and are better equipped with modern infrastructure as compared to public sector banks.

A number of banking institutions with deep-rooted structural anomalies, inadequate risk management systems, poor corporate governance practices, liquidity and solvency challenges failed to adjust to the difficult macroeconomic environment obtaining in 2003 and 2004.  The liquidity and solvency problems that were being faced by some banks were
underpinned by a number of problems as fully discussed here-under.

Over the last decade, Islamic banking has experienced global growth rates of 10-15 percent per annum, and has been moving into an increasing number of conventional financial systems at such a rapid pace that Islamic financial institutions are present today in over 51 countries. Despite this consistent growth, many supervisory authorities and finance practitioners remain unfamiliar with the process by which Islamic banks are introduced into a conventional system. This paper attempts to shed some light in this area by describing the main phases in the process, and by flagging some of the main challenges that countries will face as Islamic banking develops alongside conventional institutions.

Innovation is more than ever a hot topic among company executives in every country and industry sector. It is common knowledge that it is a key factor for mature industries to remain competitive. We focus on the retail banking sector, examining the particular case of Italian banks, and ask what drives innovation? Although managers are responsible for bringing new products and services to the market, do they utilise a formal process to capture such opportunities for their customers? We compare retail banking with other service and manufacturing industry sectors to identify where innovations are captured. We also interviewed several Italian retail banking executives to compare the results found previously in the literature. Finally, we provide a framework for managers working in retail banking to be aware of where the opportunities for developing new products and services may come from.

During the last couple of years relationship marketing has been introduced within services marketing since more efficient, profitable and long-term marketing can be achieved by focusing on present customers instead of concentrating on attracting new ones. Retail banks have in this respect had a unique position as they have a well-developed system of local offices that enable them to be close to and to establish relationships to their customers. A prerequisite for a bank that wants to establish long-term customer relationships is satisfied customers who want to remain customers. In other words, the service quality as perceived by the customers must at least meet their expectations. Otherwise there is a possibility that a dissatisfied customer starts searching for another bank offering similar services, resulting in a break in the relationship with the bank, with which he was dissatisfied.