Loyalty as Mediator in the Relationship of Leadership Style and Performance: AnExamination among Commercial Banks Employees in Klang Valley, Malaysia

Abstract

This paper attempts to present a snapshot of leadership’s style impact and influence and other related effectingreasonstowardstheemployee‘sperformanceandloyaltyinbankingindustry.Baseonreviewofpastliteratures,majorityofthestudieshadidentifiedapositiverelationshipbetweentransformational leadership and transactional leadership style toward employee loyalty and performance within the company.Thestudypopulationcomprised five headquarterofficesofcommercialbanksaroundKuala LumpurCity.Theresultofthisresearchdidsupportmostoftheresearchesdone previously inceithas been found that both leadership styles have significant (positive) relationship towards employee performance in banking industry. This paper also concluded that employee loyalty do have mediation effectbetweentransformationalleadershipandemployeeperformanceaswellasbetweentransactional leadership and employee performance. Additionally, it also proves that demographic characters do not have significant influence on employee loyalty and performance within an organization.