Identifying Customer Satisfaction Variables as a Corporate Governance Mechanism for State Owned Banks in Developing Countries – A Case of Bangladesh

Abstract

Purpose: The purpose of the paper is to identify the factors that affect and explain customer satisfactions and can be utilized as a corporate governance tool in state-owned commercial banks (SCBs) of Bangladesh Design/Methodology/Approach: Quantitative research methods have been used to collect and analyses of data. Factor analysis and multiple regressions were used to test the statistical significance of the research findings. Findings: The regression model suggested that customers ranked firstly responsiveness of the bank employees for satisfaction, then physical comfort and assurance as important factors for satisfactory service. Social/Economic Implications: The findings of the study are expected to guide state owned commercial banks in Bangladesh to improve their customer satisfaction. Improved customer satisfaction would lead good governance and improved financial sustainability of these banks leading to greater contribution by them towards economic development of the country. Originality/Value: This study is the first empirical paper that identifies factors affecting and explaining customer satisfaction of the state owned commercial banks in Bangladesh using the customer feedback directly. The study tests the transaction-specific model and enhances the literature on banking service governance.