THE CUSTOMER SATISFACTION OF THE THREE LEADING BANKS IN

THE PHILIPPINES

A Research Paper
Presented to
Dr. Juliet Hernandez
College of Liberal Arts
Pamantasan ng Lungsod ng Maynila

In Partial Fulfillment
Of the Requirements
In Technical Writing

By
Alcantara, Mikaerika T.
Atienza, Christine V.
Norberte, Mikio Cay M.
BS ACCOUNTANCY BLOCK 3-2
 Chapter 1

INTRODUCTION

For so many years of dominating the local banking industry, BDO, BPI and Metrobank

maintains a quality service that ensures the loyalty of its customers. Service quality is defined as

the difference between customers’ expectation of services and their perceptions of the actual

service performance. It is a multidimensional concept, incorporating a number of aspects of both

past and present service experience (Abdullah et al, 2011). Its significance in banks has been

emphasized in studies and perceived quality advantage leads them to higher profit. Thus, this

study was conceived to determine the customers’ view of the performance of the three leading

banks in providing them satisfaction using the SERVQUAL model.

Some of the concepts of satisfaction include value and quality. Value is the importance

attached to services based on their usage and the amount paid in exchange of the service. Quality,

on the other hand, is defined as the meeting of the needs and expectation of customers. These

concepts proved to have a crucial effect on the stability and the economic standing of these

banks. Therefore, the focus of these banks lies within customer satisfaction since they offer

undifferentiated products and used this to their advantage to survive in the market.

Customers want the best value for their money that is why they put so much effort in

searching for high quality services. Customers’ perception are determined by myriad factors

supposed that their consumption is affected or influenced by personal characters like age,

occupation, lifestyle and personality. According to Abdullah, the level of satisfaction may also be

influenced by internal and external factors.

 To obtain profit, banks offer their customers services such as investment advices,

engaging in foreign exchange trading, processing payments, and accepting deposits believing

that these customers would not want to spend their money and choose to place it with banks for

safe keeping and to earn interest as well. It is their duty, thereof, to ensure the customers that

their money is safe by offering reliable services.

Banks services are of the experience and credence types and are therefore difficult to

assess by customers. Customers cannot evaluate these types because they do not have the

required skills, expertise and knowledge to carry out the evaluation. To that effect, customers

place a high premium on the image and reputation of the bank before purchasing. Owusu-

Frimpong (2009) indicates that because services of banks are of the credence type, friends and

other fellow customers constitute the main source of information for customers which is an

advantage to the banks if they are able to satisfy these customers.

STATEMENT OF THE PROBLEM

There were few studies conducted on customer satisfaction in the banking industry.

However, none of these works concentrated on the status of local banks in the Philippines that is

affected by vast amount of consumers that seeks high quality service. This study was then aimed

to determine the quality services of the customers of the three leading banks in the Philippines as

it is a critical concept and a significant factor in maintaining financial stability and optimizing

income level. Specifically, the following questions was measured:

TECHNICAL ASPECT:
 How would these banks improve their services for the welfare of its customers?
 Does the environment of the bank give the customers comfort?
 MANAGEMENT ASPECT:

 Which among BDO, BPI and Metrobank offers the best quality service?
 What is the perception of customers to the services of these banks?
SOCIO-ECONOMIC ASPECT:
 What is the relationship of service quality and customer satisfaction
 What are the factors that affect consumer behavior?
 What are the needs and demands of the customers?
MARKETING ASPECT:
 How do these banks communicate the value of their services and products to customers?
FINANCIAL ASPECT:
 How does customer satisfaction affect the income of these banks?

SIGNIFICANCE OF THE STUDY

The main objective of this study was to compare the customers’ satisfaction regarding the

quality of service of the three leading banks in the Philippines.

Benefits to Customers
The importance of delivering excellent service quality is becoming increasingly

magnified as competition intensifies throughout the banking industry. A superior service quality

is today’s most effective bait for acquiring and retaining customers. The benefits to customers are

that they can attain better service and thus become more loyal to the company. Moreover, this

study will also help the customers to decide which bank will be a better choice to entrust their

finances.

Benefits to the Banks

This study will assist these banks to know what their clients think of their services in

terms of sex, age, location and occupation. This study will also show how BDO, BPI and

Metrobank value their opinions and prioritize their needs that would, perhaps, improve their

service for the convenience of their clients. The benefits to the bank derived from this study can

be summarized relating to the increasing market share, cost reduction and increase in income

level, improved efficient and effective customer service.

SCOPE AND LIMITATION

This study focused in its discussion on the customer satisfaction in the three leading

banks in the Philippines. It does not cover other aspects of profit-generating factors of these

banks but mainly focuses on the effect of quality service in their income. The center of

discussion was about the factors affecting the consumer behavior, consumer satisfaction and

service quality.

CHAPTER 2

THEORETICAL FRAMEWORK

INTRODUCTION

This chapter looks at the literature review. Specifically, it reviews the literature on

consumer behaviour, concepts of customer satisfaction and models and the empirical studies in

the banking sector using SERVQUAL model.

CONSUMER BEHAVIOUR
 Behaviour of consumers is not predictable since their preferences are becoming more

complex and differentiated, (Hartl, 2006). Their demand for sensory, health, process and

convenience qualities have become more heterogeneous. Individuals differ from one another and

even perceive the same thing differently, (Smith, 2009). Many organisations of late have adopted

a strategy of opening avenues for consumers to lodge their complaints. It is believed that

knowing the types of complaints will give a clue to companies to have an in-depth knowledge

about customers’ satisfaction, thus indirectly knowing the quality of services or products offered,

(Fornell, 2007). Consumers opt for certain products or particular brands not due to the fact they

offer intended functional or performance benefits only but also products can be used to exhibit

consumers’ personality, social status, affiliation or to fulfil their internal or inner psychological

needs like the desire for change or newness (emotional). There are four factors that influence

consumers’ behaviour known as cultural, social, personal and psychological.

 Cultural factors: Culture has a great impact on a person’s consumption behaviour. It is the

values, ideas and symbols that enable people to communicate interpret and evaluate as members

of society. Culture influences a person’s wants behaviour since it is learnt. They believe that in

societies in which children find themselves, they learn from the various institutions’ values,

perceptions, wants and behaviours. Thus, a culture has subcultures or groups of people like

nationalities, religions, racial groups and geographical regions with values which hold them

together. These subcultures are the main tools shaping consumers behaviour.

Assael (2009) emphasizes that social class is the divisions among people in society whereby

members are tied with similar values, interests and behaviours. Factors that determine social

class include power, prestige, occupation, income education, family background and wealth. In
 addition members of a social class are more similar than others. However, others believe that

social class has a direct influence on the purchasing behaviour of people. The perceptions, needs

and wants and the entire behaviour may differ from one social class to another.

 Social factors: reference groups, family and roles and status constitute the social factors that

influence consumers’ buying behaviour. Reference groups are groups that have direct and

indirect influence on the behaviour of their members. These groups are four types; primary

membership groups, secondary membership groups, aspirational groups and dissociative groups.

Primary membership groups are the ones which members interact and are the informal types.

These include family, neighbours, colleagues and friends. Secondary groups are the formal ones

which members interact less often. Among them are trade unions, religious groups and

professional associations. Aspirational groups are those who wish to come together as a group

whilst dissociative groups are the ones people reject their values and behaviour.

The most significant group that exerts much pressure on the individual is the family.

Apart from the fact that family members influence themselves in buying decisions, they also

undertake collective decisions. The father and the mother usually make most of the purchasing

decisions. However, with constant changing of the society, children also influence family

consumptions very much. Apart from this, parents also tutor their children to make consumptions

choices. A family’s collective decision emanate when the risk involved in the purchasing is high.

Therefore all members decide to atleast reduce the risk to the barest minimum or take risky

decisions since all will bear the consequence. Other factors for making collective decision are

when the decisions are of utmost importance and when there is much time at their disposal.

(Assael, 2009)
 Personal factors: to a large extent an individual decision to buy is influenced by the

characteristics he possesses. There characteristics include his age, and life-cycle, occupation,

economic situation, lifestyle and personality and self-concept. Aging correlates with a person’s

buying behaviour. Economic situation like the income of a person determines his purchasing

behaviour. Lifestyle also determines the consumption behaviour. This is exhibited in his

activities, interests and opinions. Personality is the unique psychological characteristic that is

responsive to someone’s own environment. Personality is seen in terms of traits like self-

adaptability, dominance, sociability, autonomy and defensive. Both personality and lifestyle

influences a person decision-making.

 Psychological factors: these factors include motivation, perception, learning and beliefs and

attitudes. Motivation is the force that drives a person to search for satisfaction. Perception is the

process through which people select, (selective attention) organise (selective distortion) and

interpret (selective retention) information to a meaningful picture about the universe. Because of

these three perceptual processes, individuals can see the same object in different ways. Selective

attention is where the individual sifts numerous information that come across his way. Selective

distortion is whereby people interpret or distort information to fit into what they have already

conceived. That means, they will accept information that conforms to what they have

preconceived. Selective retention is when people remember or retain information that is in

accordance with their beliefs, attitudes, values and interests.

CUSTOMER SATISFACTION

Both customers and banks attach much importance to satisfaction. Frantic efforts are

being made by banks to offer high quality products and services to their customers. Customers
also want the best values for their money and are sparing no efforts in selecting the best products

and services, (Strategic Direction, 2007). Once customers are satisfied and have a positive image

or intentions about a particular firm, it will take some time for competitors to snatch or convince

them to switch to them. Benefits derived by companies from customer satisfaction include

loyalty, repurchasing to increase sales or profit, speak well about the products or services to

others to purchase. As pointed out by Assael (2009), the economic viability of firms lies in the

hands of consumers. There are various types of customers or consumers. They may be

individuals, groups, organisations, communities or nations. The banking industry like any other

industry has intensified its efforts to satisfy consumers through the provision of quality service.

This stem from that fact that competition has been stiff and every bank is trying to retain the old

customers and woo new ones.

SERVICE QUALITY

According to Siddiqui and Khandaker (2007), quality of service is an elusive and

imprecise construct and is difficult to measure, because services are intangible, heterogeneous,

inseparable and perishable. Hence, marketing researchers adopted the expectancy

disconfirmation theory and developed service-quality model or SERVQUAL model. This model

has five dimensions for measuring and managing service quality: tangibles, reliability,

responsiveness, assurance and empathy (Parasuraman, Zeithaml & Berry 1988). Tangibility

refers to the appearance of the service firm’s facilities, employees, equipment and

communication materials. Reliability is the delivering the promised outputs at the stated level.

Responsiveness refers to providing prompt service and help to customers; the reaction speed

plays a vital role here. Assurance refers to the ability of a service firm to inspire trust and
confidence in the firm through knowledge, politeness and trustworthiness of the employees.

Empathy is the willingness and capability to give personalized attention to a customer.

Though the SERVQUAL model has many limitations, its framework has guided

numerous studies in the service sector, which focuses on banks, repair and maintenance ser-

vices, telephone companies, physicians, hospitals, hotels, academic institutions and retail stores

(Babakus and Boller, 2010; Carman, 2008; Cronin and Taylor, 2006). In fact, Siddiqi (2010)

concluded in his recent study that the SERVQUAL model is still suitable as an assessment tool to

measure the service quality perceptions.

Thus any bank that fails to surpass customer expectations and meet customer satisfaction

will not be able to compete with other banks. It is the most difficult challenge for a bank that its

customers transfer their accounts to rival banks because of better services.

SYNTHESIS

In the study conducted by Barbara Culiberg* Iča Rojšek, the model used in measuring

service quality was based on SERVPERF. SERVPERF assumes that respondents provide their

ratings by automatically comparing performance perceptions with performance expectations and

that measuring expectations directly is unnecessary. Through this model, they found out that the

largest part of the variability (32.2%) of customer satisfaction can be attributed to staff conduct

which may be important information for managers working in the banking sector when analysing

reasons for customer satisfaction or dissatisfaction. Another 10.5% of variability of customer

satisfaction can be linked to the range of services that the bank is offering.

With these results, it is evident that assurance and empathy primarily drive customer

satisfaction and that bank employees (especially contact personnel) have a fatal impact on the
most appealing service attribute when targeting customers (Rojšek, 2010). The conduct of staff is

at least as important as service ranges offered or even more. Furthermore, the study suggests that

hiring competent personnel will provide a high customer satisfaction. If the working

environment is managed well there is potential for a cycle of success instead of becoming stuck

in a cycle of failure (Lovelock and Wirtz, 2007).

If the first study focused on the performance of the employees and how important it is to

have a face-to-face interaction with the customer, the study conducted by Jaya Sangheeta, on the

other hand, suggest that developments in information and communications technology have

provided a platform by which companies can design, develop and deliver services that can be

perceived by customers as superior (Surjadjaja et al., 2008). With the majority of consumers

now more than ever prefer to opt for a technology-based service delivery over that of the

employee, Sangheeta developed a comprehensive model to measure customer perceptions of

service quality of technology interfaces used in commercial banks.

According to Sangheeta’s model, the technology interface service quality in banks can be

conceptualized as a seven- factor structure consisting of: ATM service quality, telephone banking

service quality, internet banking service quality, call center service quality, queue systems service

quality, core service quality and price quality (Sangheeta, 2012). Moreover, the comprehensive

model will allow bank administrators to gain a comprehensive understanding of the importance

and quality issues associated with technology interfaces, thereby allowing them a better

opportunity to improve service quality and customer satisfaction and help gain a competitive

advantage (Sangheeta, 2012).

 The study conducted by Rojšek states that banks that are trying to divert their customers

from bank offices to ATM’s and the internet may well be undermining the importance of human

contact which is essential for successful customer service (Rojšek, 2010). But, in the study

conducted by Sangheeta, she states technology is needed to reduce cost and eliminate

uncertainties.

CONCEPTUAL FRAMEWORK

The previous discussion leads to the development of Figure 1 that depicts the relationship

between the quality of services of the three leading banks in the Philippines and customer

satisfaction. The quality of services was measured by using the SERVQUAL model which

includes the five service quality dimensions or attributes: tangibility, reliability, responsiveness,

assurance and empathy. This was done by distributing questionnaires, based on the SERVQUAL

model, to know the degree of customer satisfaction.

CONCEPTUAL PARADIGM

Tangibility

Reliability
Quality of Customer
services of the
Responsivenes Satisfaction
three leading
banks in the s
Philippines Assurance

Empathy
Figure 1: Customer Satisfaction in the three leading banks in the Philippines.

Chapter 3

METHODOLOGY

This chapter presents the research design, sample, sample size and sampling techniques,

instrumentation and validation, data sources and the statistical tools that the study, “The Quality of

Services towards Customer Satisfaction of the Three Leading Banks in the Philippines” utilized.

RESEARCH DESIGN
 An exploratory research was used in this study. An exploratory research is conducted about a

research problem when there are few or no earlier studies to refer to. The focus is on gaining insights and

familiarity for later investigation or undertaken when problems are in a preliminary stage of investigation.

Exploratory research is flexible and can address research questions of all types (what, why, how).

Hence, the researchers used this research design to investigate the quality of services towards customer

satisfaction of the three leading banks in the Philippines.

RESPONDENTS

The researchers used the selected students of the College of Accountancy and Economics in

Pamantasan ng Lungsod ng Maynila to be the sample in this study. These selected respondents should be

a customer of at least one of the three leading banks in the Philippines, namely; Banco de Oro,

Metropolitan Bank and Trust Company and Bank of the Philippine Islands.

Because of the time constraint and limited funds, the researchers decided to have a total of 45

respondents to be studied. And to reduce the sampling bias and to have a fair evaluation of the quality of

services of the three leading banks in the Philippines, the researchers selected 15 customers of each of the

said banks.

SAMPLING DESIGN

The researchers used the purposive sampling method under the non-probability sampling

technique. Purposive sampling is also known as judgmental, selective or subjective sampling; it relies on

the judgment of the researcher when it comes to selecting the units that are to be studied. There are a wide

range of purposive sampling techniques but in this study the researchers intend to use homogeneous

sampling. Homogeneous sampling is a purposive sampling technique that aims to achieve a homogeneous
 sample; that is, a sample whose units share the same characteristics or traits. A homogeneous sample is

often chosen when the research question that is being address is specific to the characteristics of the

particular group of interest, which is subsequently examined in detail. The homogeneous sample in this

study was the group of people that are similar in terms of the banks they use.

Since the main goal of the researchers is to focus on the customers of the three leading banks in

the Philippines, the researchers chose purposive sampling, particularly the homogeneous sampling, as the

sampling design of the research.

INSTRUMENTATION

The questionnaire was adapted in another research paper conducted by Corneliu (2013) which

also uses the SERVQUAL model. It contained statements which are relevant to the study being

conducted.

The researchers used the Likert Scale for the respondents to answer the following questions. The

Likert Scale is a psychometric scale commonly used in questionnaires and is the most widely used scale

in survey. Such that term is often used interchangeably with the rating scale even though the two are not

synonymous. When responding to a Likert Scale questionnaire item, respondents specified their level of

agreement to a statement. They only answered very satisfied, satisfied, indifferent, dissatisfied and very

dissatisfied.

STATISTICAL TREATMENT

The data gathered was analyzed by the use of:

 Weighted Mean
 Weighted mean is the measure of central tendency. There is some variation in the relative

contribution of individual data values to the mean. Each data value (Xi) has a weight assigned to

it (Wi). Data values with larger weights contribute more to the weighted mean and data values

with smaller weights contribute less to the weighted mean. The formula in finding the weighted

mean is:

�̅�= ∑ ����∑ ��

The weighted mean was used in determining which of the five features pertaining to the

quality of services of the three leading banks in the Philippines the customers give value to.

 Standard Deviation

Standard deviation is the measurement of variability or diversity. It shows how much

variation or dispersion there is from the average. A low standard deviation indicates that the data

points tend to be very close to the mean, whereas high standard deviation indicates that the data

is spread out over a large range of values. Standard can be also defined as the square root of the

variance. In computing for the standard deviation, we will use the formula:

��= √∑(�−�)2
̅ �−1

Wherein: ̅ is the squared deviation

∑(�−�)2 n is the number of respondents

Analysis of variance (ANOVA)

 ANOVA is a collection of statistical models used to analyze the differences between

group means and their associated procedures, developed by R.A. Fisher. In the ANOVA setting,

the observed variance in a particular variable is partitioned into components attributable to

different sources of variation. In its simplest form, ANOVA provides a statistical test of whether

or not the means of several groups are equal, and therefore generalizes the t-test to more than two

groups. As doing multiple two-sample t-tests would result in an increased chance of committing

a statistical type I error, ANOVAs are useful in comparing (testing) three or more means (groups

or variables) for statistical significance.

With the use of ANOVA, the researchers can determine if there is a significant difference

between the qualities of services of the three leading banks in the Philippines. Since there are

three groups to be analyzed in this study, the researchers decided to use ANOVA instead of the

T\t-test.

PROCEDURE

It was as early as June 3, 2014 when an announcement was made that a research paper

would be a part of the requirement in completing the Technical Writing course subject. This

research was expected to serve as an input for future feasibility study or any other course

requirement.

Initially, we were asked to search for possible topics to be used in conducting our

research. On July 22, 2014, we were tasked to visit our school library to look for topics that were

explored but needs an improvement, topics that were over explored and topics to be explored,
and from there, we are to choose the topic that will serve as the center of our study. One week

after, we consulted our professor for the approval of our chosen topic and started to have our

working title for this research.

The first submission was done at August 5, 2014 where we submitted the first chapter of

this research. It contained the introduction, statement of the problem, significance of the study

and scope and limitation of the study. The statement of the problem is categorized into five sub-

categories which are the management aspect, technical aspect, financial aspect, socio-economic

aspect and marketing aspect. As we pass the first chapter, we also started working on the next

chapter of our research. Through reading, we collected the necessary data and information

regarding consumer behaviour, concepts of customer satisfaction and models and the empirical

studies in the banking sector using SERVQUAL model. These were collected from secondary

sources found in the National Library and some are from the internet. Such sources are listed in

the Reference section of this study. It took two to three weeks to gather the necessary data to be

used in this research.

The primary sources were collected through questionnaires distributed between August

19, 2014 and August 26, 2014. Each selected accessible member was approached and invited by

the researchers to participate in the study. Selected students of the College of Accountancy and

Economics in Pamantasan ng Lungsod ng Maynila were asked to complete the distributed

questionnaires and they were given as much time as needed to complete each valuation. The

questionnaires were collected immediately after it was answered and ready for analysis. The

process took at least a week.

 After gathering the data needed, these were analyzed carefully and prepared objectively

to be used in the study. Working on the last few chapters of the research was done simultaneously

as time passes by. This was done in three weeks. The last activity was to finalize the paper and

the preparation to present the results of the study.

Chapter 4

Presentation, Analysis and Discussion

The data are presented, tabulated, analyzed and discussed in this chapter. Also, the five

aspects of business considerations are included in the discussion of the data gathered in the study.

TECHNICAL ASPECT
 The SERVQUAL customer perception tool consists of 22 statements that are grouped and

related to one of the five service quality dimensions. Each of the statements is presented in two

different forms. The first part of the questionnaire is designed to measure customers’ perceptions

(P) about the service area being measured. The second time that the question appears it is

designed to measure customers’ general expectations (E) about the bank whose service quality is

being assessed. The SERVQUAL instrument captures customer expectations of service quality as

well as their perception of the services actually provided to them. The perceived service quality,

or gap score (denoted as Q) is calculated for each statement by subtracting the E score from the P

score, implying a Q score for each statement. A negative Q score indicates a level of service

quality which is below that which is expected by the customer. Conversely, a zero to positive Q

score indicates a level of service which is equal to or exceeds customer expectations.

The data collected shows that the customers of the three banks put the most importance in

the responsiveness dimension which indicates that they value the readiness and the willingness

of the employees to help them by providing prompt timely services more than any of the

dimensions. As shown in Table 1, with a p score of 4.75 and an e score of 4.3, for the BDO

customers, the Q score of 0.375 point that their customers are the most satisfied with their

employees’ services. The same results turned out with Metrobank with a 0.375 Q score and BPI

with 0.5 which also shows that the BPI customers have the best satisfaction of responsiveness

with their bank.

The data also shows that, for the BDO customers, they are the least satisfied with the

banks tangibility dimension with a Q score of negative 0.125. The tangibility dimension of the

SERVQUAL model refers to the physical appearance of the banks. As for the Metrobank, with a
Q score of negative 0.06, customers are the least satisfied with the individual attention of the

employees of the bank. For the BPI customers, the ability of the bank to perform the promised

service dependably and accurately does not satisfy them.

Table 1: SERVQUAL Dimension Results

Dimension BDO Metrobank BPI

E P Q E P Q E P Q
Tangibility 3.875 3.75 -0.125 4.125 4.34 0.215 4.5 4.625 0.125
Reliability 4.3 4.6 0.3 3.8 3.89 0.09 4.1 3.9 -0.2
Responsiveness 4.375 4.75 0.375 3.875 4.25 0.375 3.75 4.25 0.5
Assurance 4.31 4.625 0.315 4 4.11 0.11 4.125 4.375 0.25
Empathy 4.198 4.5 0.302 4.1 4.04 -0.06 3.8 3.9 0.1
Mean 4.212 4.445 0.233 3.98 4.126 0.146 4.055 4.21 0.155

MANAGEMENT ASPECT

Using ANOVA, we are able to determine which among the three leading banks in the

Philippines offers more satisfying services or if there is a significant difference in the perception-

expectation of their customers. In the survey conducted, the respondents were asked 22 questions

each for the customer perception and customer expectations. The independent variables are

computed in order to assess if there is a difference among the service quality of the banks. In

terms of the details of the ANOVA test, note that the number of degrees of freedom ("df") for the

numerator (found variation of group averages) is one less than the number of groups; the number

of degrees of freedom for the denominator (so called "error" or variation within groups or

expected variation) is the total number of leaves minus the total number of groups. The F ratio
can be computed from the ratio of the mean sum of squared deviations of each group's mean

from the overall mean [weighted by the size of the group] ("Mean Square" for "between") and

the mean sum of the squared deviations of each item from that item's group mean ("Mean

Square" for "error"). In the previous sentence mean means dividing the total "Sum of Squares"

by the number of degrees of freedom. The p-value corresponding to the F-statistic of one-way

ANOVA is higher than 0.05, suggesting that the treatments are not significantly different for that

level of confidence

Table 2: Customer Perception Results

BDO Metrobank BPI

89.0 88.0 86.0
90.0 89.0 89.0
85.0 85.0 84.0
83.0 88.0 86.0
88.0 90.0 85.0
89.0 87.0 88.0
87.0 88.0 85.0
93.0 86.0 86.0
85.0 89.0 86.0
87.0 91.0 90.0
92.0 84.0 87.0
85.0 88.0 92.0
86.0 87.0 87.0
91.0 86.0 85.0
88.0 89.0 86.0
 Table 3: Descriptive Statistics of Independent Treatments

Treatment → BDO Metrobank BPI Pooled Total

observations N 15 15 15 45

sum ∑xi 1,318.0000 1,315.0000 1,303.0000 3,936.0000

mean x¯ 87.8667 87.6667 86.8667 87.4667
sum of 115,922.0000 115,331.0000 113,261.0000 344,514.0000
squares ∑x2i
sample variance s2 8.1238 3.5238 5.2667 5.5727
sample std. dev. s 2.8502 1.8772 2.2949 2.3607
std. dev. of 0.7359 0.4847 0.5925 0.3519
mean SEx¯

Table 4: One - way ANOVA Independent Treatments

Source sum of degrees of mean square F statistic p-value

squares SS freedom ν MS

Treatment 8.4000 2 4.2000 0.7449 0.4809

Error 236.8000 42 5.6381

Total 245.2000 44

Table 5: Customer Expectation

BDO Metrobank BPI

 92.0 87.0 89.0
89.0 87.0 90.0
86.0 86.0 88.0
84.0 85.0 83.0
87.0 87.0 84.0
85.0 90.0 86.0
88.0 84.0 88.0
86.0 88.0 87.0
90.0 87.0 84.0
89.0 89.0 88.0
88.0 88.0 89.0
87.0 86.0 90.0
89.0 85.0 86.0
86.0 88.0 87.0
87.0 90.0 84.0

Table 6: Descriptive Statistics of Independent Treatments

Treatment → A B C Pooled
Total
observations N 15 15 15 45

sum ∑xi 1,313.0000 1,307.0000 1,303.0000 3,923.0000

mean x¯ 87.5333 87.1333 86.8667 87.1778

sum of 114,991.000 113,927.000 113,261.000 342,179.000

squares ∑x2i 0 0 0 0

sample 4.2667 3.1238 5.2667 4.1040

variance s2
sample std. 2.0656 1.7674 2.2949 2.0258
dev. s
std. dev. of 0.5333 0.4563 0.5925 0.3020
mean SEx¯

Table 7: One - way ANOVA of Independent Treatments

Source sum of degrees of mean square F statistic p-value
squares SS freedom ν MS

treatment 3.3778 2 1.6889 0.4003 0.6726

Error 177.2000 42 4.2190

Total 180.5778 44

SOCIO-ECONOMIC ASPECT

Understanding that the five dimensions of customer service quality have been identified

and established by extensive research conducted by the SERVQUAL developers and that all five

has been found to be important to customers. They have also concluded that the customer base

assign different levels of importance to each dimension. The SERVQUAL customer perception

tool that included a section between the expectation and perception sections that asked the

respondents to divide 100 points between the five dimensions based upon their perception of

importance. The respondents were asked to assign the most points to the most important

dimension and fewer points to the least important dimensions.

 This study revealed the importance ranking of the SERVQUAL dimensions of the

customers of the three leading banks from most important to least important as:

1. Responsiveness
2. Reliability
3. Assurance
4. Empathy
5. Tangibility

The average importance score was also used to weight the gap scores for each dimension.

Weighted scores were established by multiplying the dimension weight and the dimension gap

score. The weighted score helps to clarify the significance of the perception/expectation gaps.

17.26 13.63

Tangibility
Reliability
21.2 Responsiveness
18.31
Assurance
Empathy

29.6

Figure 2: Dimension Weight

MARKETING ASPECT
 In the midst of competitive banking industry, the banks innovate and improve their

services constantly for the growing demands of their customers to maintain harmonious and

continuous relationship with them. Customer satisfaction is one of the important factors in

creating bonds with customers and because of these, the banks find ways to communicate their

services and products in the most convenient mode for their clients.

In the survey conducted, the respondents were asked about their way of doing

transactions with their respective banks. Banks offer their services in different mediums like

internet and phones. The results showed that the customers still prefer a face-to-face transactions

if it concerns their finances. Table 8 proves, with 46.667 percent that instead of using a phone or

the internet which is more convenient, customers would be more assured if they do their

transactions personally.

Table 8: Service Communication Results

Mode of dealing with the bank Percentage

Office 46.667%
Telephone 20%
Internet 33.333%
Total 100%

FINANCIAL ASPECT

In this study, customers are assumed to be the only profit-generating factor for banks. As

it is, the effect of their perception to the services of these banks has a great impact on its income

and financial stability. This study, however, limits the knowledge of the researchers as to how
customer satisfaction directly affects the income of the three leading banks. Further explanation

on this aspect will be discussed in the final chapter.

Chapter 5

Summary of Findings, Conclusion and Recommendation

SUMMARY OF FINDINGS

The main aim of the study is to compare the perception of customers regarding the

quality of service of the three leading banks in the Philippines. Forty five customers of at least one

of the three leading banks in the Philippines, namely; Banco de Oro, Metropolitan Bank and Trust

Company and Bank of the Philippine Islands from the College of Accountancy and Economics in

Pamantasan ng Lungsod ng Maynila were chosen for the study. Information was gathered from

the community through a questionnaire.

CONCLUSION

The readiness and willingness of the employees to help the customers by providing

timely services was found to be the most important dimension and the Bank of the Philippine
Island gives its customers the best satisfaction of responsiveness. While the tangibility dimension

which refers to the physical appearance of the banks was the least important among the

aforementioned dimensions, and the BDO customers were least satisfied with this. But with

overall customer satisfaction, there is no significant difference with the service quality of the

three leading banks.

The findings suggest that since it was found out that the responsiveness dimension is

what the customers give their most importance then the banks should provide their employees

seminars or other ways that would improve their social skill and be able to communicate with

their customers. Seeing the demand of the customers for timely services, these banks should also

require its employees to always put the customer’s interests first and do it sincerely to earn their

trust.

The study elicited five quality dimensions namely responsiveness, reliability, assurance,

empathy and tangibility. These dimensions of customer service quality have been identified and

established by extensive research and that all five has been found to be important to customers.

They have also concluded that the customer base assign different levels of importance to each

dimension. The readiness and willingness of the employees to help the customers by providing

timely services was found to be the most important aspect in responsiveness dimension and the

Bank of the Philippine Island gives its customers the best satisfaction of responsiveness. While

the tangibility dimension which refers to the physical appearance of the banks was the least

important among the aforementioned dimensions, and the BDO customers were least satisfied

with this.
 The banks innovate and improve their services constantly for the growing demands of

their customers to maintain harmonious and continuous relationship with them. Customer

satisfaction is one of the important factors in creating bonds with customers and because of

these, the banks find ways to communicate their services and products in the most convenient

mode for their clients. Banks offer their services in different mediums like internet and phones.

The customers still prefer a face-to-face transactions if it concerns their finances. Instead of

using a phone or the internet which is more convenient, customers would be more assured if they

do their transactions personally.

With the assumption that customers are the major or the only source of income of the

three banks, the researchers can conclude that with a high customer satisfaction, the banks

income is greatly affected, therefore, these banks should put more effort in improving their

service to provide the customers their needs and demands. But since it is only an assumption and

these banks have more ways of generating income, the direct effect of customer satisfaction is

still vague to make a definite conclusion in this aspect.

With all the findings gathered, we can conclude that the three leading banks in the

Philippines namely; Banco de Oro, Metrobank and Bank of the Philippine Islands does not have

a significant difference in the quality of their service. The customers have almost the same

perception on these banks’ services and it also shows that with the perception being higher than

the expectation, then it means that these customers are satisfied with their respective banks.

RECOMMENDATION

Service quality is a crucial factor in maintaining financial stability in banks, thus, studies

like this would be a great help to improve their services and provide their customers a better and
a more satisfying service. For future researchers, the following recommendation must be taken

into account:

1. Since this study uses the SERVQUAL model, future studies must use other models like

SERVPERF or the 360-degree leader to see if it will give the same results. This way,

banks will have more information and awareness about customer satisfaction.
2. Make a full study in this topic. Broaden the profit-generating factors of the banks and see

how important customer satisfaction is to its income.

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