Low Visibility of Foreign Banks in the Sri Lankan Banking Industry

Abstract

The Sri Lankan banking sector is dominated by Licensed Commercial Banks (LCBs) that has the highest contribution and accounts for 86%, of the Banking Sector assets. Out of the 22 LCBs,11 are branches of international banks. But the six main local LCBs, which include 2 state banks that alone account for 42% of the LCB assets, has dominated the banking sector so far. Even though the international banks are backed by a long history of operations in Sri Lanka and a goliath and stable Group structure, they are yet to make their mark in the local banking industry. This research, focus on identifying the factors affecting the visibility of international banks, via an in-depth study in customer awareness of the products and services offered, customer preference and loyalty towards the banks and the level of marketing done by these banks to establish their brand image. Both primary and secondary data collection techniques were used to obtain data. Primary data collection was done via a questionnaire that was circulated primarily via electronic format. The secondary data used, was marketing budgets and Net Promoter Scores (NPS) of international banks. Both qualitative and quantitative data analysis methods such as co-relation, two sample variance testing and non parametric analysis has been used to identify relationships between the variables under investigation and their impact on the visibility of foreign banks in the Sri Lankan retail banking industry.