Use this URL to cite or link to this record in EThOS: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.693208
Title: Impact of financial distress on UK bank performance and customer loyalty : an empirical study
Author: Ngwa, Leonard Ndifor
ISNI:       0000 0004 5921 7968
Awarding Body: University of Wales Trinity Saint David
Current Institution: University of Wales Trinity Saint David
Date of Award: 2016
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Abstract:
In the light of the global financial crisis of 2007 which is considered to be the worst since the Great Depression of the 1930s, it is evident that no bank is too big to fail. There have been a number of corporate failures in recent years, including instances in the United Kingdom. These events, therefore, motivated this study in terms of emphasising the need to apply financial distress prediction models to examine the performance of UK banks. This work aims at empirically examining and analysing the performance of UK retail banks amid the financial crisis, covering three periods: before, during and afterwards. In doing so, the accuracy of Altman‘s financial ratios of early warning statistical distress prediction models was examined. Both primary and secondary data were employed to find answers to the research questions. The first result indicated that Altman‘s ratios: leverage, solvency and turnover ratios significantly discriminated the three crisis periods. Yet, Altman‘s model had high misclassification error rate and less predictive power during the crisis than before and afterwards. With regards to the performance of banks, the result revealed that banks performed better in terms of profitability, liquidity and activity ratios for pre and post crisis than during the crisis. Additionally, researchers have become increasingly interested in linking marketing variables such as satisfaction, trust and loyalty to financial performance. While profitability ratio is commonly confirmed to be a significant predictor of performance, loyalty constructs are not generally assessed in this manner in the profit link framework. This implied that loyalty has not been shown to have a direct impact on financial performance. Hence, since both loyalty and profitability play vital roles to determine the success of banks, they should be fully considered before performance is established. In this thesis, an extension of past profit link research to include nonfinancial variables was considered. This research examined the link between satisfaction, trust and loyalty, and overall financial performance. The overall empirical findings provided evidence of a positive relationship of loyalty and levels of relative profitability. Nevertheless, satisfaction and trust were not statistically related to profitability in the UK retail banking sector.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID: uk.bl.ethos.693208  DOI: Not available
Keywords: HF Commerce ; HG Finance ; HJ Public Finance
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