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1.0 Introduction:

1.1 Origin of the Report

As a student of Masters of business administration (MBA) in Management, every student has to conduct a practical orientation in any organization for fulfilling the requirements of the 12 weeks Internship program. The main purpose of the program is to expose the students to the real world situation .This report is done as a partial requirement of the Internship program for the MBA students.

1.2 Rationale of the study

In order to fulfill the requirement of the Internship program, I chose Prime Bank Ltd. The Human Resource Division (HRD) of Prime Bank Ltd placed me to its Panthapath Branch. The HRD of Prime Bank Limited also assigned me a topic of the report to be submitted. The topic of my report is “Evaluation of Customer Service Quality in Prime Bank Limited”. I have done my internship in Prime Bank Limited, Panthapath Branch for the period of November 2005 to February 2006. I have partly worked in few departments of the branch but mainly focused in the general banking department. It has given me a chance to directly communicate and provide professional service to the bank clients. During this period I tried to get familiarize myself with the theoretical concept and practical process of customer service in Prime Bank Limited.

1.3 Objective and scope of the study:

The primary objective of this report is to use the theoretical concepts, gained in the classroom situations, in analyzing real life scenarios. This is also a partial requirement of the MBA program. This objective is basically met by remaining attached with a reputed organization and by gaining some real life experiences, so that it adds value to the knowledge base of me, an MBA graduate. In case of this report, the objectives are:

• To observe and understand the activities of the different departments of the host organization: Prime Bank Limited (PBL)

• To identify the customers demand to Prime Bank Limited.

• To identify the customers perception or attitude towards the customer services of the prime Bank Limited.

• To identify the quality of services compared to other Banks.

• Determine the relationship between complained and satisfaction.

• Provide suggestions to ensure better customer service.

Prime Bank limited is one of the successful private banks in our country. I arranged the report into two main parts. In the first part of the report I focused upon the organizational structure and the financial services offered by PBL. The report also concentrates upon the actual lending activities of the company, its exposure to the various sectors and its performance.

The second part of the report basically focuses on the Study of Customer services quality in Prime Bank Limited, Panthapath Branch on the basis of a Questionnaire and which was adorned on the basis of some parameters. Finally I analyzed the findings from the questionnaire and came to a conclusion with some of my recommendations.

1.4 Methodology:

I have collected primary and secondary data for my research paper.

1.4.1 Primary Sources:

I have collected primary data by interviewing employees and clients of the Prime Bank Limited .I made a questionnaire for the customer of the Prime Bank Ltd. and collected primary data by survey method. I also collected Primary data by face to face conversation with the officers of the Bank.

1.4.2 Secondary sources:

I have collected secondary data for my research paper .I have collected secondary data for my research paper from:

• Banks annual report

• Banks records

• Different documents of the Bank

• Different books, periodical seminar papers, training papers, manuals etc. related to the topic.

1.4.3 Target Group:

The target group was the customers of Prime Bank Limited.

1.4.4 Data Collection and presentation Techniques:

I designed a structured questionnaire for the customers of the Prime Bank Limited .This structured questionnaire were the major tool of this research paper. After the data collection I analyzed and presented the data by percentage, graphical presentation techniques used different types of charts. I tried to analyze the major or critical findings .Then, based on everything; I provided recommendations and conclude the research paper.

1.4.5 Sample Size:

I surveyed 120 clients of the Prime Bank Limited by the questionnaire.

1.5 Limitation of the study:

• The one of the main limitations of the research paper was to conduct a small scale survey on clients.

• Time period was the other limitation for collecting information, which was only three month long.

• Insufficient supply of relevant books and journals.

2. Profile of Prime Bank Limited :

2.1 Background of the Bank:

Prime Bank is one of the new Bangladeshi private banks, which was incorporated on 17th April 1995 with Tk. 1000 million of authorized capital & Tk. 100 million of paid up capital by a group of successful entrepreneurs. It is not only a conventional Bank. It’s a modern, dynamic private commercial bank & plays a constructive role in the economic development of the country. Prime bank is the first private bank to introduce lease finance, Hire purchase & customer credit schemes along with Islamic banking services in the banking sector in order to bring about qualitative changes in the lives of people of Bangladesh. PBL through its steady progress & continuous success has, by now, earned the reputation of being one of the leading private sector Banks of the country.

Prime Bank is listed with ‘promoter shareholders’ collectively holding a 46% stake in the bank. One of the main reasons for the bank’s good financial condition is that the bank’s promoters, who have other business interests as well, have refrained from ‘using’ the bank for insider lending. This is a huge issue for Bangladeshi private banks, and together with somewhat lax supervision, is the single biggest factor for the poor financial condition of most private banks. While Prime Bank has so far benefited from its promoter shareholders’ approach of maintaining an arms-length relationship between the bank and their other businesses, whether this would continue to be the case in future, particularly when the second-generation promoters become directors of the bank, remains to be seen.

Prime Bank mainly caters to the trade finance market. Manufacturing activity in Bangladesh is relatively subdued, but there are certain industries such as textiles, where the country has a competitive advantage. Many textiles manufacturers export their merchandise (garment exporters for example) and it is this customer segment that the bank mainly caters to. The bank is involved at all stages of the export cycle: it gives pre-shipment finance for working capital and also provides post-shipment facilities such as bill discounting. In addition, the bank also undertakes some amount of project financing for its clients’ plant and machinery, or modernization requirements. The lending restrictions on state banks (due to their poor capital position) have helped private banks such as Prime, which have been growing at rapid rates (30-35% per annum). While the bank has done well so far, its relatively small size makes it somewhat vulnerable to unexpected loan losses if some large accounts go bad. Over the last three years, Prime Bank has introduced credit cards in association with MasterCard. The credit card market in Bangladesh is still relatively undeveloped with only about 250,000 cards in circulation (population of Bangladesh: 130m). The foreign banks (mainly Standard Chartered) are the main players in this segment, although some local banks such as Prime have been investing in this market to position themselves for the future. While delinquency rates on credit cards are relatively high (Prime Bank: 10%; another local bank: 20%), the annualized interest rates on outstanding balances are more than 40%, so it is a lucrative business to be in. Prime Bank has signed a co-branding agreement with HSBC for issuing credit cards on their behalf, and also plans to tie-up with VISA in the near future.

In addition to conventional interest-based banking, Prime Bank operates two branches (completely separate from conventional banking) on the Islamic Shariah principle; however, Islamic banking operations are relatively small and constituted only about 5% of the conventional banking business.

2.2 The Profile at a Glance

Name: Prime Bank Limited

Date of Incorporation: 12th February, 1995

Date of Inauguration of Operation: 17th April, 1995

Registered Office: Adamjee Court Annex Building-2

119-120, Motijheel C/A

Dhaka-1000, Bangladesh.

Logo: [pic]

Name of the Chairperson of the board: Mr. Ajam J Chowdhury

Name of the Managing director: Mr. Md. Shahjahan Bhuiyan

Number of Branches: 37

Services Provided: Deposit scheme, Loan & Islami

Banking.

Diversification of products

& services: Corporate Banking, Retail Banking &

Consumer Banking.

Paid up capital: Tk. 1000 million

Publicly Traded Company: Share quoted daily in DSE & CSE

Credit Card: Member of Master Card

Banking Operation System: Both Conventional and Islamic Banking System.

Technology Used: Member of SWIFT, on line Banking,

UNIX based Computer System

Initial Public Offering:

Number of Shareholders: 2620

Market value per share: 879.50

E-mail: primebnk @

Web Site: prime-

SWIFT: PRBLBDDH

[pic]

2.3 Hierarchy of Prime Bank Limited

|Chairman |

(

|Board of Directors |

(

|Executive Committee |

(

|Managing Director |

(

|Additional Managing Director |

(

|Company Secretary |

(

|Sr. Executive Vice President |

(

|Executive Vice President |

(

|Senior Vice President |

(

|Vice President |

(

|Sr. Asst. Vice President |

(

|Assistant Vice President |

(

|First Assistant Vice President |

(

|Senior Executive Officer |

(

|Executive Officer |

(

|Principal Officer |

(

|Senior Officer |

(

|Officer / Management Trainee |

(

|Junior Officer |

(

|Trainee Assistant Officer |

2.4 Vision and Mission:

Prime Bank Limited aims to become one of the top-performing banks by prudent financing, to earn sustainable profit & rendering of services to customers more efficiently & effectively. Its Vision is to be the most efficient bank in terms of customer service, profitability and technology application and Mission is continuous improvement in their business policies and procedures as well as cost reduction through integration of technology at all level. To achieve the mission, strategic priorities shall have the sustainable growth, broader and improved range of product and services.

2.5 Financial Highlights:

(Taka in million)

|Sl.# |Particulars |2004 |2003 |

|1 |Paid-up Capital |1,000.00 |700.00 |

|2 |Total Capital |2,476.34 |1,958.12 |

|3 |Capital surplus/deficit |401.53 |477.21 |

|4 |Total Assets |32,361.62 |24,249.13 |

|5 |Total Deposits |28,069.24 |20,483.23 |

|6 |Total Loans and Advances |23,219.67 |16,492.22 |

|6 |Total Contingent Liabilities and Commitments |20,531.79 |16,351.42 |

|7 |Credit Deposit Ratio |83% |81% |

|8 |Percentage of Classified Loans against Total Loans & Advances |1.52% |1.98% |

|9 |Profit after tax & provision |611.94 |375.46 |

|10 |Amount of classified loans during current year |246.23 |214.45 |

|11 |Provisions kept against classified loan |174.00 |249.44 |

|12 |Provision surplus/(deficit) against classified loan |52.66 |85.98 |

|13 |Cost of fund |6.62% |7.32% |

|14 | Interest earning Assets |29,137.28 |21,936.70 |

|15 |Non-interest earning Assets |3,224.34 |2,295.65 |

|16 |Return on investment (ROI) |6.36% |6.58% |

|718 |Return on Assets (ROA) |2.16% |1.72% |

|19 |Income from Investment |196.15 |167.77 |

|20 |Earning per Share |61.19 |37.55 |

|21 |Net Income per Share |61.19 |37.55 |

|22 |Price Earning Ratio |14.37 |6.98 |

2.6 Branch Network:

Prime Bank has 40 existing branches and some other proposed branch all over the Bangladesh to provide better service to their valuable customers.

[pic]

Figure 3: Branch Network

Existing Branches

Dhaka Division

(Motijheel Branch (Uttara Branch

(Dhanmondi Branch (Foreign Exchange Branch

(New Eskaton Branch (Islamic Banking Branch

(Madhabdi Branch (Mohakhali Branch

(Banani Branch (Kawran Bazar Branch

( Islamic Banking Branch (Mouchak Branch

(Pragati Sarani Branch (Elephant Road Branch

(Shimrail Branch (Gulshan Branch

(Shyamoli Branch (Bangshal Branch

(Tongi Branch (Narayanganj Branch

(Panthapath Branch (Gonakbari Branch

(Moulvi Bazar Branch

Chittagong Division Rajshahi Division

(Jubilee Road Br (Rajshahi Branch

(Agrabad Branch (Bogra Branch

(Khatungonj Branch

(Islamic Banking Branch Khulna Division

O.R. Nizam Road

(Islamic Banking Branch (Khulna Branch

B S Plaza (Jessore Branch

(Fatickchari Branch

Sylhet Division Barisal Division

(Sylhet Branch (Barisal Branch

(Islamic Banking Branch

Nabiba Complex

(Court Road Branch

( Tajpur Branch, Sylhet

(Upashahar Branch, Sylhet

(Beanibazar Branch

2.7 Field of Operations:

PBL, being one of the best financial intermediaries in the country, blended its operations in conventional banking, Islamic banking and investment banking. The blending has been done with the objective of diversifying the operations for catering to the needs of the customers of the different strata of the society from one viewpoint and for having sustainable growth in profitability and business with the least possible risk. The bank’s operations were diversified into the following areas of activities as a dynamic financial intermediary.

✓ Conventional Banking Operation

✓ Islamic Banking Operation

✓ Lease Finance Operation

✓ Merchant Banking

✓ Retail Banking

In order to carry out the above operations PBL has set up the following divisions, departments and units in its Head Office:

1. Credit Operation & Management Unit

a. Corporate/Relationship Operation Department

b. Credit Risk Management Department

c. Credit Administration department

d. Credit Monitoring and Recovery Department

e. Export Finance Division

f. Small & Medium Enterprise (SME) Credit Cell

g. Structured Financing Unit

2. International Division

3. Treasury Division

4. Leasing Unit

5. Card Division

6. Retail Credit Division

7. Corporate Affairs Division

8. Islamic Banking Division

9. Merchant Banking & Investment Division

For facilitating operations by the above mentioned divisions the bank has established the following divisions to provide support and internal services:

✓ Human Resource Division

✓ Information Technology Division

✓ Public Relations Division

✓ Financial Administration Division

✓ General Services Division

✓ Marketing Division

✓ Prime Bank Training Institute

✓ Branches Control Division

For ensuring internal and statutory compliance there are following three cells namely,

o Board Audit Cell

o Audit and Inspection Division

o Central Compliance Department

Besides, there is a Board Secretariat to look after the company matters and to for arrange for Board/Executive Meetings and record the proceeding of the board/EC.

2.8 Services Provided:

1) Deposit Scheme

2) Loan

3) Islami Banking

Deposit Scheme:

Bank is the largest mobilizer of surplus domestic savings. For poverty alleviation, we need self employment, for self-employment we need investment and for investment we need savings. In the other words, savings help capital formations and the capital formations help investments in the country. The investment in its turn helps industrialization leading towards creation of wealth of the country. And the wealth finally takes the country on road to progress and prosperity. As such, savings is considered the very basis of prosperity of the country. The more the growth of savings, the more will be the prosperity of the nation.

The savings rate in Bangladesh is one of the lowest in the world. In order to improve the savings rate, Financial Institutions responsible for mobilization of savings should offer attractive Savings Schemes so that the marginal propensity to save increases. The savings do not, of course, depend only on the quantum of income but largely depend on the habit of savings of the people.

PBL formulated the following Savings Schemes

(Contributory Savings Scheme (Monthly Benefit Deposit Scheme

(Education Savings Scheme (Fixed Deposit Scheme

(Short Term Deposit (Lakhopati Deposit Scheme

(Double Benefit Deposit Scheme (Foreign Currency Account

(Resident Foreign Currency Deposit Account

(Non-resident Foreign Currency Deposit Account

(Non-resident Taka Account

(Non-resident Investors Taka Account

]

Loan Scheme:

General Loan Scheme

Depending on the various nature of financing, all the lending activities have been brought under the following General Loan:

( Short term Loan

( Medium term Loan

( Long term Loan

The loans are allowed to individual/firm/industries for a specific purpose but for a definite period and generally repayable by installments fall under this head. This type of lending are mainly allowed to accommodate financing under the categories (i) Large & Medium Scale Industry and (ii) Small & Cottage Industry. Very often term financing for (1) Agriculture (ii) Others.

Hire Purchase

Hire Purchase is a type of installment credit under which the Hire Purchase agrees to take the goods on hire at a stated rental, which is inclusive of the repayment of Principal as well as interest for adjustment of the loan within a specified period.

House Building / Apartment Loan Scheme

Loans allowed to individual/enterprises for construction of house (residential or commercial) fall under this type of advance. The amount is repayable by monthly installment within a specified period. Such advances are known as Loan (HBL-GEN).

Loans allowed to our Bank Employees for purchase /construction of house shall be headed Staff Loan (HBL-STAFF).

Lease Finance

Lease financing is one of the most convenient long term sources of acquiring capital machinery and equipment. It is a very popular scheme whereby a client is given the opportunity to have an exclusive right to use an asset, usually for an agreed period of time, against payment of rent. Of late, the lease finance has become very popular in almost all the countries of the world. An obvious advantage of the lease is to use an asset without having to buy it. The lessee is obligated to make lease payments until the expiration of the lease agreement, which corresponds to the useful life of the asset.

In a capital scarce economy like ours, Lease Financing is suitable for firms to acquire Capital Machinery, Equipments, Medical Instruments, and Automobiles etc. And thereby employ their own resources more advantageously in some other investments. Lease financing also helps a firm to reap significant economic benefit through tax saving and by reducing the risk of the equipments becoming obsolete due to the technological advancement.

Small & Medium Enterprise (SME)

Bangladesh is a densely populated country. Job opportunity here is very scanty; Unemployment rate is approximately 40%. Population below poverty line is 36%. Therefore, it is the prime concern for the nation to generate income through creation of job opportunity & employment. Creation of job opportunity at large scale by us is not possible. What can be done better is to help self-employment through financial support. There are many small and medium entrepreneurs in the country that have innovative idea, spirit and potentiality to do something productive for local consumers as well as export abroad.

They can generate income and contribute to the GDP. They may also provide employment to other people. Development and growth of Small and Medium Enterprise is vital for national development. Such type of beneficial enterprises borrower can not go a long way for want of financial support because they have no access to institutional credit facilities, as they cannot provide collateral security as demanded for such credit facility.

Advance Against Share

In order to contribute to the development of the Capital Market of the country Prime Bank Limited extends credit facilities against pledge of Shares to the individuals as well as to the Member of DSE & CSE.

Consumer Credit Scheme

In order to provide financial assistance to the limited income group for raising their standard of living by acquiring domestic durables like Refrigerator, T.V., Washing machine, Furniture, Computer, Motor Car, etc., the bank has introduced a Scheme to improve the quality of life particularly of the fixed income earner of the society and this scheme is known as Consumer Credit Scheme (CSS).

Islami Banking:

Prime Bank has started its Islami Banking operation through its first Branch being inaugurated at 19, Dilkusha C/A, Dhaka on 18 December 1995. Since then it has so far has established four more branches at different locations in the Country. Because of its popularity and management’s commitment toward social well being gradual expansion of Prime Bank’s Islami Banking operations is assured. Following are the salient features of Islamic Banking, as is practiced in Prime Bank Limited:

01. All activities are conducted according to Islamic Shariah.

02. Interest free monetary operations.

03. Building partnership relation between the Bank and its customers.

04. Following Islamic principles in its investment portfolio.

05. While investing special consideration to social needs is given.

06. Through small and long term deposit schemes providing hope to the poor income group of the society.

07. Client service centric banking, through which making the clients feel special.

08. Conduct welfare activates etc.

Service Portfolio:

Prime Bank provides following services under Islami Banking:

(Deposit

(Investment

(Foreign Trade

(Remittance and Fund Transfer

2.9 Performance:

Prime Bank has been profitable since the first year of its operations. Profits were low in 1998 as the bank incurred losses on its stock market operations. Management described this as a ‘learning experience’ and has since refrained from stock trading activities. Indeed the bank’s profitability has been exceptional compared with its Bangladeshi counterparts, and it reported an average ROE of 41% (ROE at end-2002 was 30%) between 1999 and 2002.

As a fully licensed commercial bank, Prime Bank Ltd. is being managed by a highly professional and dedicated team with long experience in banking. They constantly focus on understanding and anticipating customer needs. As the banking scenario undergoes changes so is the bank and it repositions itself in the changed market condition.

Prime Bank Ltd. has already made significant progress within a very short period of its existence. The bank has been graded as a top class bank in the country through internationally accepted CAMEL rating. The bank has already occupied an enviable position among its competitors after achieving success in all areas of business operation.

The bank has consistently turned over good returns on Assets and Capital. During the year 2004, the bank has posted an operating profit of Tk. 1146.14 million and its capital funds stood at Tk 2476.06 million. Out of this, Tk. 1000 million consists of paid up capital by shareholders and Tk. 1476.06 million represents reserves and retained earnings.

The bank’s current capital adequacy ratio of 10.74% is in the market and much above the stipulated line of 9%. In spite of complex business environment and default culture, quantum of classified loan in the bank is very insignificant and stood at less than 1.52%.

2.10 Comparative Position:

Prime Bank Ltd. offers all kinds of Commercial Corporate and Personal Banking services covering all segments of society within the framework of Banking Company Act and rules and regulations laid down by our central bank. Diversification of products and services include Corporate Banking, Retail Banking and Consumer Banking right from industry to agriculture, and real state to software.

Prime Bank Ltd., since its beginning has attached more importance in technology integration. In order to retain competitive edge, investment in technology is always a top agenda and under constant focus. Keeping the network within a reasonable limit, bank’s strategy is to serve the customers through capacity building across multi delivery channels.

Bank’s past performance gives an indication of their strength. The bank is better placed and poised to take its customers through fast changing times and enable them compete more effectively in the market they operate.

There are 52 banks operating in our country. Among all these banks PBL has established itself as one of the most influential local bank. Prime Bank’s position can be figured out from the following table

PBL’s Comparative Position

(Figure in crore Tk.)

|Sl |Banks |Operating Profit |ROA |EPS |Deposit |Advance |Paid-Up Capital |

|No. | | | | | | | |

|1 |Prime Bank |101.58 |6.57 |155 |2109.24 |1649.22 |100 |

|2 |Dhaka Bank |54.00 |4.19 |101.69 |1685.10 |1288.70 |53.10 |

|3 |Dutch-Bangla bank |45.30 |3.96 |280 |1713.40 |1143.20 |20.20 |

|4 |Southeast |70.30 |4.52 |120.64 |2011.90 |1554.80 |56.40 |

|5 |Social Investment Bank|50.10 |4.98 |192 |1970.90 |1005.80 |26.00 |

|6 |NCC Bank |62.50 |4.86 |113 |1515.40 |1285.0 |22.20 |

|7 |Al-Arafah Bank |30.70 |4.05 |60.6 |864.30 |757.20 |50.60 |

Source: Prime Bank Training Institute

Graphical Representation:

[pic]

Figure 4: Comparative Position

So, Prime Bank Limited is a fast growing and modern private commercial bank. It is making its marks in the country’s socio-economic condition by channel zing the much-needed fund to the entrepreneurs. And by doing this consistently and efficiently it is also satisfying the shareholders.

2.11Panthapath Branch of Prime Bank Limited :

Panthapath Branch of Prime Bank Limited is a profit earning branch .It is one of the newest branch of Prime Bank Limited which was established just in April 2005. It is situated at the ground floor of Firoj Tower at the Green Road crossing. It is a very important place as the place is becoming a more commercial area day by day.

The Branch has 12 Officers of which the Head Of the Branch Mr. Fazle Haider is a Vice President of Prime Bank Limited .The Branch has 1 Senior Executive Officer, 1 Executive Officer, 1 Principal Officer, 2 Senior Officers , 1 Officer , 4 Junior Officers and 1 Trainee Assistant Officer. All of them are very cooperative and helpful which is enough to satisfy their clients. .Although it started its operation in April 2005 as the year ended we have to admit that despite all barriers it succeeded to fulfill its profit target. Although it is not still a Authorized Dealer of Foreign Exchange , it performs its dealings through its Kawranbazar Branch.The performance of this Branch is very well which could be analyzed with the help of following data.

Yearly(2005) Closing Position of Panthapath Branch

| Deposit | Tk 38,62,94,131 |

| Bills Payable | Tk 35,13,345 |

| Advance | Tk 4,86,38,265 |

| Profit/ Loss Position | Profit Tk 41,20,539 |

| Cash in Hand | Tk 48,00,424 |

| Bangladeshi Bank Balance | Nil |

| Other Bank Balance | Nil |

| Total Inland L/C opened | Nil |

Panthapath Branch is a new Branch ,so it is cognizable that the Branch will take time to settle down in a ‘Prime ’ condition. As the Officers always try hard to improve the status and the high officials of the Bank are always keen to make the Branch a busiest one it is expected that the above volume will be larger day by day.

3.0 Literary Review

1. Customer Service :

Customer service means to provide customers with good services in order to earn profit along with customer satisfaction .

Successful customer service companies focus their attention on both their customers and their employees .They understand the service profit chain , which links service firm profits with employee and customer satisfaction .This chain consists of five links :

• Internal service quality : Superior employee selection and training , a quality work environment ,and strong support for those dealing with customers.

• Satisfied and productive service employees :More satisfied ,loyal and hard working employees .

• Greater Service Value : More effective and efficient customer value creation and service delivery.

• Satisfied and loyal customers : Satisfied customers who remain loyal, repeat purchase , and refer other customers.

• Healthy service profits and growth : Superior service firm performance.

From the above discussion it can be said that well managed customer service companies share a number of common virtues regarding customer service .Successful service companies are “Customer Obsessed” ,and set high service quality standards.

2. Managing Service Quality :

A service firm may win by delivering consistently higher quality service than competitors and exceeding customers expectations. These expectations are formed by their past experiences ,word of mouth and advertising. After receiving the service , customers compare the perceived service with the expected service. If the perceived service meets or exceeds their expectations, they are apt to use the provider again.

Researchers formulated a service quality model that highlights the main requirements for delivering high service quality. The model, shown in the figure below , identifies five gaps that cause unsuccessful delivery.

1.0 Gap between consumer expectation and management perception : Management doesn’t always perceive correctly what customers want. A Bank authority may think that clients want prompt service but clients may be more concerned with more responsiveness.

2.0 Gap between management perception and service quality specification:

Management might correctly perceive the customers wants but not set a specified performance standard. A Bank may tell the Officers to give fast service without specifying it quantitatively.

3.0 Gap between service quality specifications and service delivery :

The personnel might be poorly trained , or incapable or unwilling to meet the standard or they may be held to conflicting standards, such as taking time to listen to customers and serving them fast.

4.0 Gap between Service delivery and external communications : Customer expectations are affected by statements made by company representatives and advertisements.

5.0 Gap between perceived service and expected service :This gap occurs when the consumer misperceives the service quality. The Banker may keep visiting the valued clients but the client may interpret this as an indication that something really is wrong.

3.3 Service quality Parameters :

Researchers found out five parameters of service quality . These are presented in order of importance :

1.0 Reliability : The quality to perform the promised service dependably and accurately. In its broadest sense reliability means that the company delivers their services on its promises .Customers want to do business with companies tat keep their promises ,particularly their promises about the core service attributes.In my questionnaire 3 question were to assess the reliability of the Prime Bank Limited ,which were :

1. Do you think PBL provides the services all time that it promises to do so ?

2. When you face a problem PBL show interest to solve the problem?

3. Problems are solved very promptly?

2.0 Responsiveness : Responsiveness is the willingness to help customers and to provide prompt service .This dimension emphasis attentiveness and promptness in dealing with customer request ,questions, complaints and problems .Responsiveness is communicated to customers by the length of time they have to wait for assistance ,answer to questions or attention to problems .Responsiveness also captures the notion of flexibility and ability to customize the service to customer needs.

In my questionnaire the following questions were about responsiveness:

1. Do you think PBL employees are very friendly and helpful?

2. Do you think employees always search for solutions for you?

3. Do you think the behavior of the officers satisfy you ?

3.0 Assurance:

Assurance is defined as employee’s knowledge and courtesy and the ability of the firm and its employees to inspire trust and confidence .This dimension is likely to be particularly important for services that the customers perceive as involving high risk.

In my questionnaire the following questions were about Assurance :

1. Do you think the employees of PBL are trustful and reliable ?

2. Every transaction by PBL employees is safe to you ?

3. Do you think as a Bank ,Prime Bank is always trustworthy from all aspect ?

4.0 Empathy :

Empathy is defined as the caring ,individualized attention the firm provides its customers. The essence of empathy is conveying through personalized or customized service that customers are unique and special.

In my questionnaire the following questions were about Empathy :

10. Do you think PBL always give you individual attention?

11. Do you think PBL understands your specific needs?

12. Do you think PBL believes in personal relationship with their clients ?

5.0 Tangibles :

Tangibles are defined as the appearance of physical facilities ,equipment ,personnel, and communication material .

In my questionnaire the following questions were about tangibles:

13. Do you think PBL use modern looking equipment ?

14. Do you think the Bank has a convenient transaction hour?

15. Do you think PBL should introduce new facilities like ATM card and credit card facilities ?

There were also another question asking whether the customers are satisfied with

the present charges and fees of Prime Bank Limited. Also there was a scope for them to opine on the Bank services .These were also evaluated through the whole survey process.

4.0 Customer Service of Prime Bank Ltd

4.1 An overview of customer services activities :

Prime Bank Limited is a leading Bank in Bangladesh .At the end of 2005 fiscal year, it stood the first position among the native conventional Private Banks in case of profit. It is also in a very good position in the Bangladesh Bank introduced CAMEL rating. As it is topped among the other financial institutions ,it is also very much caring to its customers.

So customer service is always a very vital issue for Prime Bank Limited. There is a common dialogue in Prime Bank which says “Customers are our KING ”.So it likes to treat its customers with a very outstanding manner. As the hospitality is very necessary, the Bank always try to give its clients the best service. All the efforts and works in the Branch Banking environment focus on customer satisfaction .There are several departments in a Bank which is more or less directly linked with the customers.These are front dest ,Computer section ,Cash department, CCS department and also foreign exchange department.An evaluation of customer services given by this department can be discussed below :

4.2. Front desk activities :

Front desk play a very vital role in a Bank’s customer service. This happen gradually that a prospective client approach to a Bank at first to know something .To know the facilities which the Bank could provide him. Clients want to know various matters to a Bank. There are varieties of clients .Someone may be a teacher, someone is a doctor, someone is businessman and may be some are students. To a Bank all the prospective customers are equally valuabe. When a client enters into a Bank ,he at first meet to the Front Desk. So the officers who serve here play a very important role .It is a very common rule that “First impression should be the best impression ”.Prime Bank is very prompt in their front desk activities. Here customers find their guideline and all necessary information .They can open their account ,open different deposit scheme, deposit cheques for clearing, can do Pay Order and could get all support to do so from the experienced officers.

4.3 Computer Department :

Computer is a very necessary part of Branch Banking activities.At present Prime Bank is using PC BANK software for their all daily transaction .Officers help customers in this section to post their cheques ,provide them bank statement , give them different types of certificates as the customers demand. They also provide them bank balance directly or over phone. Here officers help their clients to get a track of all transactions as if they feel comfort.

4.4 Online Banking in Prime Bank Limited :

At present Prime Bank provide online banking to some selected customers .To get this facility an account holder need to apply first. Then the bank decide whether the account will be benefited with online Banking. If a account holder gets online banking facility then he is able to make transaction in any Branch of Prime Bank Limited.

5.0 Findings and analysis of Customer Services Quality :

5.1 Questionnaire findings and analysis :

Now the survey findings are represented by according to different parameters.The answer of the questions are representing according to the parameter that identify the customer perception or attitude towards customer services of the Prime Bank Limited.

5.1 a Reliability Parameter:

Q 1 Do you think PBL provides the services all time that it promises to do so ?

|Satisfaction option |Percentage |Frequency |

|1 |30% |36 |

|2 |40% |48 |

|3 |25% |30 |

|4 |5% |6 |

|5 |0% |0 |

Q 2 When you face a problem PBL show interest to solve the problem ?

|Satisfaction option |Percentage |Frequency |

|1 |32% |39 |

|2 |44% |53 |

|3 |13% |15 |

|4 |11% |13 |

|5 |0% |0 |

Q3 Problems are solved very promptly ?

|Satisfaction option |Percentage |Frequency |

|1 |32% |39 |

|2 |44% |53 |

|3 |13% |15 |

|4 |11% |13 |

|5 |0% |0 |

Findings :

• Prime Bank Limited provide its services at the time it promises to do so.

• When you face a problem Prime Bank Ltd shows a sincere interest to solving it.

• Problems are solved promptly.

5.1b Responsiveness Parameter :

Q 4 Do you think PBL employees are very friendly and helpful ?

|Satisfaction option |Percentage |Frequency |

|1 |12% |14 |

|2 |34% |41 |

|3 |17% |21 |

|4 |23% |27 |

|5 |14% |17 |

Q 5 Do you think employees always search for solutions for you ?

|Satisfaction option |Percentage |Frequency |

|1 |39% |47 |

|2 |23% |28 |

|3 |22% |26 |

|4 |8% |10 |

|5 |8% |9 |

Q6 Do you think the behavior of the officers satisfy you ?

|Satisfaction option |Percentage |Frequency |

|1 |41% |49 |

|2 |22% |26 |

|3 |17% |21 |

|4 |15% |18 |

|5 |5% |6 |

Findings :

• Employees of Prime Bank Limited are friendly and helpful.

• Employes always search for solutions for the clients.

• The behaviour of the employees is very good.

5.1c Assurance :

Q 7 Do you think the employees of PBL are trustful and reliable ?

|Satisfaction option |Percentage |Frequency |

|1 |42% |51 |

|2 |28% |33 |

|3 |12% |14 |

|4 |14% |17 |

|5 |4% |5 |

Q8 Every transaction by PBL employees is safe to you ?

|Satisfaction option |Percentage |Frequency |

|1 |13% |16 |

|2 |38% |45 |

|3 |27% |32 |

|4 |19% |23 |

|5 |3% |4 |

Q 9 Do you think as a Bank ,Prime Bank is always trustworthy from all aspect ?

|Satisfaction option |Percentage |Frequency |

|1 |45% |54 |

|2 |26% |31 |

|3 |21% |25 |

|4 |8% |10 |

|5 |0% |0 |

Findings :

• Employees of Prime Bank Limited are trustful and reliable .

• The transaction by PBL employees is safe to the clients.

• As a Bank ,Prime Bank Limited is trustworthy to its clients.

5.1 d Empathy

Q10 Do you think PBL always give you individual attention ?

|Satisfaction option |Percentage |Frequency |

|1 |26% |31 |

|2 |52% |62 |

|3 |6% |8 |

|4 |16% |19 |

|5 |0% |0 |

Q11 Do you think PBL understands your specific needs?

|Satisfaction option |Percentage |Frequency |

|1 |24% |29 |

|2 |28% |33 |

|3 |38% |46 |

|4 |10% |12 |

|5 |0% |0 |

Q12 Do you think PBL believes in personal relationship with their clients ?

|Satisfaction option |Percentage |Frequency |

|1 |15% |18 |

|2 |25% |30 |

|3 |32% |39 |

|4 |21% |25 |

|5 |7% |8 |

Findings :

• Prime Bank Ltd .always gives individual attention to its clients.

• Prime Bank Ltd. understands customers specific needs.

• Prime Bank believe in personal relationship with their clients.

5.1 e Tangibles :

Q 13 Do you think PBL use modern looking equipment

|Satisfaction option |Percentage |Frequency |

|1 |23% |28 |

|2 |46% |55 |

|3 |13% |16 |

|4 |11% |13 |

|5 |7% |8 |

Q14 Do you think the Bank has a convenient transaction hour?

|Satisfaction option |Percentage |Frequency |

|1 |36% |43 |

|2 |43% |52 |

|3 |17% |20 |

|4 |4% |5 |

|5 |0% |0 |

Q15 Do you think PBL should introduce new facilities like ATM card and credit card facilities ?

|Satisfaction option |Percentage |Frequency |

|1 |50% |60 |

|2 |27% |32 |

|3 |16% |19 |

|4 |7% |9 |

|5 |0%% |0 |

Findings :

• Prime Bank use modern equipment in their Banking service.

• Prime Bank has a convenient transaction hour.

• Modern facilities like ATM machine, credit card facility should be introduced to Prime Bank.

5.1 f Others

Q16 Do you think the fees and service charges of the Bank is reasonable in comparison with other Banks ?

|Satisfaction option |Percentage |Frequency |

|1 |12% |14 |

|2 |38% |46 |

|3 |27% |33 |

|4 |11% |13 |

|5 |12% |14 |

Findings :

Customers seldom say that the charges of Prime Bank Ltd is quite high .So these fees should be reduced.

Q17 What is your opinion to improve the Services of the Bank

| Option |Percentage |Frequency |

| Introduction of ATM |58% |70 |

| Transaction hour long |22% |27 |

| Online Promptness |12% |14 |

| Service charge lower |5% |6 |

| Friendly atmosphere |3% |3 |

Findings :

Clients of Prime Bank Limited strongly desire ATM service ,which we found from the above table.Some say that Evening Banking should be little more lengthened while some demands online service to be very fast.

5.2 SWOT Analysis:

SWOT analysis enables an organization to have a comprehensive insight about its current position in the industry compared to the competitors. It provides the organization a scope to strategically improve its position in the market. Here, the internal strength and weakness of Prime Bank Limited as well as the external opportunities and threats are discussed:

5.2 a Strength:

➢ Capital Adequacy:

Prime Bank Ltd. is maintaining a strong capital base. By the end of March 2005, capital adequacy ratio of the bank was 10.74% that is well above the stipulated requirements of 9%. The bank had a target to have tk. 1000 million of capital fund by the year 2006, whereas it already reached capital fund of almost tk. 2000 million by 2003, positioning the bank as one of the strong capital based bank of Bangladesh. The bank has now also increased its authorized capital to 4000 million to its expansion programs.

➢ Customer Service:

PBL has a very good relationship with its customers. The bank believes in maintaining personal relationship with the clients. One of the major goals of the bank is to build long term relationship with the customer and to create value for them. To maintain this relationship, PBL sometimes waiver high charges for those valued clients who are linked with the bank for a long period of time. The bank recently has approximately more than 1,54,000 clients, highest in the private sector commercial banks of our country.

➢ Liquidity Position:

Liquidity position is a major criterion to measure a bank’s strength. By the end 2003 PBL has a liquid assets of Tk. 4584.45 million, the ratio of liquid assets to total was 18.92%. So, the liquidity risk of the bank is low and makes its position stronger.

➢ Efficient Administration

Prime Bank Ltd. had an efficient administration. The work is done in a timely and systematic manner for which the efficient administration is responsible. There is close relationship between the employees and management though the chain of command is maintained strictly. Overall, there is a good balance between the administration and the employees.

➢ Quality of Assets:

The asset of PBL is of very high quality. The major portion of this asset is loan and advances. The default rate is less than 2.00% whereas the average default rate in Bangladesh is 30%. This proves that the credit risk of PBL is very low.

5.2 b Weakness

➢ Technology:

One of the major weaknesses of Prime Bank Ltd. is the technology used by the bank. With the change of time, technological advancement is essential to survive in the competition. Hence, PBL is lagging far behind in this area. Most of the branches are not well equipped. There are not enough computers, telephones and faxes machine in the branches which often slower the pace of work. PBL is the pioneer of on banking in Bangladesh but unfortunately enough that this facility is lagging behind in the present scenario of banking as others offer more sophisticated online banking.

➢ Remunerations:

The pay scale of the employees in PBL is not competitive compared to other private banks of Bangladesh. The employees of the PBL get compensation of around 40% of what other private banks, for example Dhaka Bank, Southeast Bank etc. offer to their employees. This creates dissatisfaction among the employees that carries the risk of rise in employee turnover rate. It also create job switch tendency among the PBL employees.

➢ Promotion:

When an employee gets a promotion to the next level, he/she gets more compensation. PBL is regular in giving promotion, but the employees get late effect of this promotion. Often there is a long gap, for example a six month gap in getting the effect.

➢ Training:

PBL has its own training institute PBTI (Prime Bank Training Institute) to strengthen the capabilities of human resources. However, it is not always possible to give through training. Especially, there is a lack of specific training for specific jobs. As a result, the employee has to learn things from the job by doing it practically.

5.2 c Opportunity

➢ ATM Facility:

Currently Prime Bank Ltd. does not have ATM facility. Many other leading competitors have ATM service that provides 24 Hours limited cash transaction to their clients. This service is highly preferred by the clients, as they have to wait less time in ATM booth. So, PBL has good opportunity to install ATM service to meet the greater service demand of consumers.

➢ Branch Expansion:

Prime Bank is growing quickly all over the country. Besides expanding in the urban areas, PBL has prospects to open more branches in sub-urban areas, which will eventually enhance the government effort at receiving rural economy as well as reaching more people by better service.

➢ Training Facility:

Prime Bank Training institute (PBTI) is supporting the bank by offering in house training courses, workshops and seminars. As the bank has its own training institute to enhance the capability of human resources, PBL can use this opportunity to train their employees in specific areas and create specialized and expert people for the bank.

➢ Banking Software:

Prime Bank is still lagging behind in upgrading their software system. The bank has the prospect to select high quality banking software which will make the banking operations easier and smooth as providing quality service is one of the major goals of Prime Bank Limited.

5.2 d Threats

➢ Level of Competition:

Competition is always a major threat for any organization. In recent years, the number of private bank is increasing. These banks always pose a threat for others by coming up with new product line, innovative technology, quality services, etc. thus the level of competition rises and creates threat for prime bank limited.

➢ Technological Advancement:

With time, technology is getting advanced and most of the private banks are upgrading their operating system to survive in the industry. PBL is lagging behind in this department and still mostly dependent on manual work rather than technology. Advancement of technology is posing great threat for PBL.

➢ Compensation Package:

Compared to other private banks of Bangladesh, the compensation of PBL is not so attractive. Though the employee of PBL gets fair financial and other benefits, the base pay is not sufficient. This poses a lot of threat on the employees of switching to other banks from PBL.

➢ Political Unrest:

The political unrest as well as the law and order situation of Bangladesh is always a threat for banking industry. Especially, the events of recent years, the corruption level of our country, the poor infrastructure are affecting the national economy. The current economic situation is very likely to get worse further. In this case, the whole banking industry is facing a big threat.

6.0 Comparison of Prime Bank Limited with other Competitive commercial Bank :

In this case I have selected Standard Chartered Bank and BRAC Bank Limited as these bank has a better perception of the consumers as better and fast service providing bank. The comparison are shown below:

|Sl |Prime Bank Limited (PBL) | BRAC Bank Limited |Standard Chartered Bank |

| | | |(SCB) |

|1. |PBL offers a vast range of |1. BRAC Bank offer products that is both |1. SCB also offers similar |

| |products that are quite |favorable to higher and middle earning groups|attractive products mostly |

| |attractive to different |of the society. |to the higher income group |

| |income group of consumers. | |of consumers. |

|2. |PBL offers master and visa credit card facility|2. At present BRAC Bank |2. SCB also offers master and |

| |both in home and abroad with 24 hours call |don’t offer any type of credit card facility |visa credit card facility both |

| |center for help. |to its customers. |in home and abroad with 24 |

| | | |hours call center for help. |

|3. |PBL don’t offer telephone information or |3. BRAC BANK serve its customers with 24 hour|3. SCB offer customer care through Call |

| |customer care services. |customer care service . |Center Phone Link access by which customers |

| | | |can get information’s about their accounts |

| | | |and details over telephone. |

|4. |PBL don’t offer ATM (auto teller machine) to |4. BRAC Bank has ATM facility in its all |4. SCB offer the largest network of ATM |

| |their customers. |Branches and also in some places where it |service all over Bangladesh. It also provides|

| | |doesn’t have any branch. |paying different utility bills. |

|5. |PBL offer ONLINE banking only to few selected |5. BRAC Bank offer online facility to all of |5. SCB has a central software network which |

| |customers who are eligible. Online banking |its customers. |offer all clients to ONLINE banking facility |

| |helps client to deposit and draw money form any| |all over Bangladesh. |

| |branch of the bank. | | |

|6. |PBL offers Evening Banking at some selected |6. BRAC Bank has evening Banking facility |6. SCB offers Evening Banking at some |

| |branch which is up to 4p.m to 6 p.m. |where it serves even upto 8.0 PM . |selected branch which is upto 6p.m to |

| | | |8 p.m. |

|7. |PBL charges moderately low to their customers |7. BRAC Bank also charges moderately low to |7. SCB charges moderately high to their |

| |for their services. |its customers. |customers for their services. |

|8. |PBL maintains strict regulations about giving |8. BRAC bank is quite moderate to disburse |8. SCB is a bit flexible about giving advance|

| |advance to their clients; as a result they |loan to its clients. |to their clients; as a result they usually |

| |usually take considerate amount of time to | |take less time to disburse loans. |

| |disburse loans. | | |

|9. |PBL offer locker service to their clients at |9. BRAC Bank also offer locker services to |9. SCB offer locker service to their clients|

| |some selective branches. |some selected Branches. |at most branches. |

|10. |Numbers of credit card holder are less than |10. Brac Bank don’t have any credit card |10. SCB have large number |

| |SCB. |service . |of credit card holders |

| | | |compared with other |

| | | |commercial banks. |

7.0 Recommendations and Conclusion :

7.1 Recommendations :

The survey results have given valuable information as to where improvements are necessary to improve the customer services quality of PBL. Now I recommend the following major things, which will be helpful for PBL:

❑ Banking is a service-oriented business. Its business profit depends on its service quality. That’s why the authority always should be aware about their service quality.

❑ Modern banking today is introducing various kinds of services, which attract different types of target customers. PBL should diversify its banking services and add new features in its services so that it can attract customers from all groups of people. Financial researcher of PBL should be innovative in developing new banking services, which will attract customers and also reduces cost.

❑ Bank should offer more facilities to the customers such as ATM machine service.

❑ Now a days world is going very fast. Now most of the banks open online customer service system. So in order to compete in the competitive market they should adopt real time online banking system in every branch.

❑ Prime Bank Limited should provide bank statements periodically, because most of the top positioned bank now a days offer this facility. The bank should redesign the format of its account into a clearer and easily understandable format that will be helpful for the customers.

❑ As for deposit schemes, PBL has innovative products like the education savings scheme, but it can do product extension and increase its deposit base by introducing more variety in the maturity of the schemes.

❑ Long-term training very much required for the employees.

❑ Many branches can be opened to reach the bank’s services in remote locations.

❑ In general banking department it is necessary to implement modern banking process instead of traditional system. It should be more computerized.

❑ Data based networking is the most modern technology to transfer data form branch to branch or branch to head office and vice versa. So they must use this technology in information Technology (IT) dependent of the Bank.

13.0 Conclusion

Prime Bank limited is a modern commercial bank.. It is committed to provide high quality financial services / products to contribute to the growth of G.D.P. of the country through stimulating trade & commerce, accelerating the pace of industrialization, boosting up export, creating employment opportunity for the educated youth, raising standard of living of limited income group and overall sustainable socio-economic development of the country.

The Bank is operating efficiently with its existing products and services. It has remained profitable from the inception of its operation in the commercial banking sector. The emergence of fierce competition and adverse economic condition has forced the bank to be innovative in offering its products and customer services.

Service quality is a critical component of customer perceptions. In the case of pure services, service quality will be the dominant element in customers’ evaluations.

The services which the branch provides to their clients, are very prompt and quality one compare to other private or foreign banks. So Prime Bank is the bank, which will survive in the banking sector of the world on the slogan "Bank with a difference".

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Top Management

Mid Level

Management.

Executive Level

Management

Junior Level

Management

Chittagong Division

Khulna

Division

Barishal

Division

Sylhet

Division

Rajshahi

Division

Dhaka

Division

Existing

Branches

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