Relationship between financial performances and marketing practices in the banking sector of Jordan

Majed Khalil Shami

doi:10.21511/bbs.14(1).2019.02

Abstract

The study aims at analyzing the relationship between financial performances and marketing practices in the banking sector of Jordan. A questionnaire was distributed to 45 top, middle, and branch level managers of 15 banks. The financial data was obtained from the financial statements and annual reports of the banks during the five-year period between 2011 and 2015. The three categories of participants, who were recruited, were top-level managers, middle-level managers and branch-level managers from 17 banks of Jordan. No two means were found to differ significantly at 0.05 level by means of Scheffe test. The results revealed that the more positive the perception was of the managers regarding the position of their banks in the market, the more they were inclined to choose an accurate target market in accomplishing their marketing objectives. Therefore, it has been concluded that when the financial needs of the customers were similar, the change in the loan-to-deposit ratio was significantly positive.

Highlights

The progress and the economic growth of a country is contingent on a sound banking sector (Rajaraman & Vasishtha, 2002)
The results revealed that the more positive the perception was of the managers regarding the position of their banks in the market, the more they were inclined to choose an accurate target market in accomplishing their marketing objectives
It has been concluded that when the financial needs of the customers were similar, the change in the loan-to-deposit ratio was significantly positive

Summary

Introduction

The progress and the economic growth of a country is contingent on a sound banking sector (Rajaraman & Vasishtha, 2002). Allocate, distribute, and mobilize a major portion of savings; and subsequently the performances of the banks have significant implications for the growth of organizations, capital allocation, industrial expansion and a country’s economic development. The steady growth of a country’s economy is essential for the functioning and survival of its industries and its banking sector. The liquidity risk is evaluated and measured; when this ratio increases, the banks grant more loans without increasing the deposits. It places a big burden on the banks and has a significantly negative effect on the financial performance of the bank (Waemustafa & Sukri, 2016)

Results

Discussion

Conclusion