3.0 Market Conduct of Bank Industry
The banking industry in Malaysia started getting significant back in the 1900s when rapid economic development occurred. The growth in economic was the result of sky-rocketed profit from the rubber plantations and the tin industry, which later causing the opening of foreign bank branches and the setting up of Malaysia’s first domestic bank – Kwong Yik (Selangor) Banking Corporation in 1913, which is also now known as MayBank.
The banking industry has continued its steady growth and expansion until eventually there was a need for a governing body to oversee the activities and operations of the numerous banks in the country. This led to the establishment of central bank, Bank Negara Malaysia, an organization wholly-owned by the Federal Government.
As bank industry in Malaysia has becoming more and more competitive in the recent years as new bank organizations set in the industry. Financial institutions have to carry out market conduct in order to be competent in this dynamic market where strategies are being prioritized to achieve organization’s goal. The conduct of the banks is highly depending on the structure of bank industry, the factors which determine the competitiveness of the market. There is several strategy mixes being implemented in the current banking industry to satisfy consumer demand as well as their utility.
3.1 Market Segmentation and Targeting
A market segment should consist of a group of customers who share a similar set of needs and wants (Kotler, 2009). A market segment must be accessible, measurable, large enough and profitable in order to be worth targeted by an institution. When a new product package is launched into a certain geographical region, a time lag of half a ye...
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...aining brand and to learn more trust.
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As there are many types of banking and financial institutions in Cambodia, the scope and limitation of the study is mainly take only the commercial banks and microfinances to examine. The study will only go through the basic background of the banking industry and the basic issues and solutions which excludes the other related cases involved in politics.
middle of paper ... ... inga (1999) and Pasiouras and Kosmidou (2007). The above estimation has left some questions pertaining to fill the gap by attempting to identify and measure factors that determine the profitability performance of commercial banks in Malaysia. What are bank-specific determinants and macroeconomic determinants influence on banks’ profitability in Malaysia compare to other countries?
This is followed in section 5 by an analysis of the recent changes in the banking industry. With the development of the financial system, declining entry barriers and the deregulation of the banking industry make banks no longer the monopoly suppliers of banking services and reduce their comparative advantages which they usually hold in the past. Whether the reasons give rise to the existence of banks are still powerful will be examined here, while section 6 offers a way of considering whether banks are declining by looking at the value added by the banks. When the value added by banks is examined, banks are not a financial intermediation, which not only conduct the traditional services but also provide more diversified