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Journal of Relationship Marketing

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Examining Service Quality and Customer Satisfaction in the Retail Banking Sector in Vietnam
Van Dinh & Lee Pickler
a a b

Faculty of Finance and Banking, VNU-University of Economics and Business, Hanoi, Vietnam
b

College of Business and Technology Management, Northcentral University, Prescott Valley, Arizona, USA Version of record first published: 13 Dec 2012.

To cite this article: Van Dinh & Lee Pickler (2012): Examining Service Quality and Customer Satisfaction in the Retail Banking Sector in Vietnam, Journal of Relationship Marketing, 11:4, 199-214 To link to this article: http://dx.doi.org/10.1080/15332667.2012.741022

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Journal of Relationship Marketing, 11:199214, 2012 Copyright Taylor & Francis Group, LLC ISSN: 1533-2667 print / 1533-2675 online DOI: 10.1080/15332667.2012.741022

Examining Service Quality and Customer Satisfaction in the Retail Banking Sector in Vietnam
VAN DINH
Faculty of Finance and Banking, VNU-University of Economics and Business, Hanoi, Vietnam

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LEE PICKLER
College of Business and Technology Management, Northcentral University, Prescott Valley, Arizona, USA

The present study focused on examining the interrelationship between service quality dimensions (tangibility, reliability, responsiveness, assurance, and empathy) and investigated the correlation between perceived service quality and customer satisfaction in the retail banking sector in Vietnam. The predictor variables (independent variables) for this research were the aforementioned service quality dimensions. The outcome variable (dependent variable) was overall customer satisfaction. This study can help bank leaders evaluate and improve the service quality of retail banking in the context of nancial liberalization and globalization. KEYWORDS customer satisfaction, retail banking, service marketing, service quality

INTRODUCTION
Vietnams banking sector is expected to have one of the highest growth rates in Asia during the next few years because of the countrys continued economic expansion, rising household incomes, and relatively low penetration of existing banking services. Over the past two decades, the Vietnamese government has undertaken a series of reforms to strengthen and modernize the sector as part of the countrys move toward a more open and market-oriented
Address correspondence to Van Dinh, VNU (Vietnam National University), University of Economics and Business, P512, E4 Building, 114 Xuan Thuy Street, Cau Giay District, Hanoi, Vietnam. E-mail: [email protected] 199

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economy. In recent years, rapid economic growth has improved the household income and demand for retail banking services. Credit and debit card use has become more common, with the number of cards issued doubling between 2008 and 2010 to 28.5 million. The number of automated teller machines (ATMs) has also increased dramatically, rising from 1,800 in 2005 to 11,000 as of December 2010 (State Bank of Vietnam [SBV], 2011). However, the retail banking sector is still in its infancy (Business Monitor International [BMI], 2011; SBV, 2011). As of December 2010, an estimated 23% of Vietnams population of approximately 90 million people had bank accounts, and around half of those with accounts actively used consumer banking services (Ho & Baxter, 2011). One of the main concerns for the underdeveloped banking industry in Vietnam is the inadequate service quality in the retail sector (BMI, 2011; SBV, 2011). Service quality assessment is an important leadership task needed to achieve organizational success (Glaveli, Petridou, Liassides, & Spathis, 2006). Cronin and Taylor (1992) described ve dimensions (tangibility, reliability, responsiveness, assurance, and empathy) that constitute customer expectations of service. The specic problem addressed in this study is the need for improvement in the quality of retail banking services in Vietnam to increase customer satisfaction. The possible relationship between service quality and customer satisfaction in the retail banking sector in Vietnam should be examined to nd solutions to this problem. Researching service quality and customer satisfaction is important for both domestic and foreign banks in the competitive Vietnamese market (Oh, 2009; SBV, 2011). In the past, foreign banks in Vietnam were limited because the government allowed only a single branch per city. Since 2007, upon Vietnams accession to the World Trade Organization, this number has increased with the presence of many foreign banks. Some foreign banks, namely Australia and New Zealand Bank, Hongkong and Shanghai Banking Corporation, Standard Chartered, Deutsche Bank, United Overseas Bank, and Sumitomo Mitsui Banking Corporation, have strategies for entering the market by becoming strategic partners with domestic banks. Currently, domestic banks have around a 90% share of the retail market in Vietnam (SBV, 2011). However, foreign banks are fast becoming strong competitors in the retail banking market by providing services with high technologies, which domestic banks do not have. Foreign banks currently can provide a full range of banking services that previously only domestic banks could offer. Consequently, competitiveness in the banking sector is increasing. Survival issues will force bank managers to nd solutions to improve their service quality and customer satisfaction.

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LITERATURE REVIEW
The literature conceptualizes service quality as the gap between delivered and expected service performance. Customers perceive the relative inferiority or superiority of services by comparing a rms actual performance with their

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expectations. The gap between perception and expectation is perceived service quality (Beerli, Martin, & Quintana, 2005; Parasuraman et al., 1991a). Customers are more concerned about their money value and have higher expectations of service providers nowadays. If customers perceive that service quality is unsatisfactory, they will not hesitate to take their business elsewhere (Hossain & Leo, 2009; Uppal & Mishra, 2011). In addition, modern technology increases market transparency, which enables competitors to provide similar or improved versions of any new products (Granados, 2005). The banking industry, like many other service industries, is facing demanding customers, erce competition, new technologies, and other changing economic variables (Jham & Khan, 2008). Therefore, it is imperative for banks to achieve customer satisfaction through service excellence. In fact, much research has been done on service quality and customer satisfaction in the banking industry in particular countries (Beerli et al., 2004; Cui, Lewis, & Park, 2003; Duncan & Elliott, 2005; Gou, Duff, & Hair, 2008; Gournaris, Stathakopolous, & Athanassopolous, 2003; Ibrahim, Joshep, & Ibeth, 2006; Jabnoun & Khalifa, 2005; Kumar, Kee, & Manchor, 2009; Lopez, Hart, & Rampersad, 2007; Poolthong & Mandhachitara, 2009; Ravichandran, Mani, & Prabhakaran, 2010). Other research has compared differences in customers perceptions of the quality of banking services in two or more countries (Dash, Bruning, & Acharya, 2009; Lasser, Manolis, & Winsor, 2000; Yavas & Benkenstein, 2007). The initial research in dening and measuring service quality and customer satisfaction was established in the mid-1980s by Gronroos (1984) and Parasuraman et al. (1985). Gronroos and Parasuraman et al. were the earliest researchers to point out that quality prevalent in the goods sector is not extendable to the services sector. Because of the intangible characteristics of service, quality in the service context is difcult to measure and evaluate (Parasuraman et al., 1991a). Various measuring models have been developed for measuring perceptions of service quality (Aldlaigan & Buttle, 2002; Bahia & Nantel, 2000; Cronin & Taylor, 1992; Gronroos, 1983; Parasuraman et al., 1991a; Stafford, 1996; Tsoukatos & Mastrojianni, as quoted in Munusamy, Chelliah, & Mun, 2010; Parasuraman et al., 1988; Parasuraman et al., 1991b; Parasuraman et al., 1994). However, the most widely used models for measuring quality in service industries and customer satisfaction in general and in the banking sector in particular are the SERVQUAL of Parasuraman et al. and the SERVPERF of Cronin and Taylor. The present study used the SERVPERF model to examine the relationship between service quality and customer satisfaction.

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RESEARCH OBJECTIVES
Very little work has been performed to measure service quality and customer satisfaction in the retail banking sector in Vietnam. This study involved testing the correlation within ve dimensions of service quality suggested by

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Cronin and Taylor (1992) in a specic industry (banking) and population (Vietnam). The relationship between service quality and customer satisfaction was examined to assess the consistency of previous studies in the Vietnamese market context. This study provides original contributions to ll two main knowledge gaps. First, the study contributes to current and future research by comparing and contrasting related literature. The ndings of the study provide evidence supporting results in the previous literature, such as ndings from Hanzaee and Salehi (2011), Munusamy, Chelliah, and Mun (2010), Ozdemir and Hewett (2010), and Ravichandran et al. (2010). Second, the study provides a practical application to measure service quality within retail banking services in Vietnam. The study aims to impact the success of the growing retail banking sector in a transition economy through analyzing customer reactions to service quality by examining customers levels of satisfaction with specic service quality dimensions. The study serves as a guideline for policymakers and leaders of banks in Vietnam to improve their service quality and customer satisfaction.

RESEARCH DESIGN AND QUESTIONS

The research examined the interrelationship of ve service quality dimensions. In addition, the study attempted to determine whether service quality dimensions have an association with overall customer satisfaction. These objectives were examined using two research questions:
RQ1: To what extent, if any, is there a signicant relationship between the dimensions of service quality among retail banking customers in Vietnam? RQ2: To what extent, if any, is there a signicant relationship between perceived service quality and customer satisfaction among retail banking customers in Vietnam?

The use of a quantitative research methodology with a correlational design was appropriate for answering these two research questions. The SERVPERF model developed by Cronin and Taylor (1992) served as the foundation of the survey instrument to examine the problem of service quality. This model measures service quality through customer perceptions of ve quality dimensions, which are demonstrated through 22 survey items. Five service quality dimensions or attributestangibility, reliability, responsiveness, assurance, and empathyare used to measure perceived service quality in banks. A survey instrument using a 7-point Likert-type format in two languages (Vietnamese and English) was designed to collect participant perceptions to conduct statistical comparison. Participants were recruited from among

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current retail banking customers in Vietnam. Participants completed the survey during their visit to bank branches and ATM locations and through an online survey. The study included the use of both quota sampling and convenience sampling procedures to collect data from 394 participants to achieve a signicant sample size to remain at a 3% sampling error rate and a power criterion of .80 for an effect size of .20 at an alpha level of 5% (Creswell, 2008).

SAMPLE DATA ANALYSIS AND FINDINGS

The data were analyzed in different sections: reliability and validity analysis, descriptive analysis, factor analysis, correlation analysis, and multiple regression analysis. Reliability in a study focuses on whether the research method and design are accurate (Cooper & Schindler, 2008). Validity is concerned with how well the survey questions measure what they are intended to measure. Descriptive statistics are regularly used and reviewed from hard copy and during analysis to examine the variables being used. Factor analysis had two purposes. First, I wanted to reduce a large number of variables to a smaller number of factors for modeling and research objectives when the large number of variables precluded modeling all of the measures individually. Second, I expected to validate a measure for perceived service quality that was adjusted from the SERVPERF model by Cronin and Taylor (1992) to t the banking market in Vietnam. Correlation analysis using Pearsons test was used to examine the association between service quality dimensions. Finally, multiple regression analysis was used in an attempt to demonstrate the impact of ve service quality dimensions in explaining the overall satisfaction of customers in the retail banking sector in Vietnam.

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Reliability and Validity

I started the data analysis by examining the reliability and validity of the sample data. Cronbachs alpha coefcients for the study variables ranged from .896 to .906, and that of the overall scale was .903. These high Cronbachs alpha coefcients indicate that each construct had high internal consistency among the items measuring the constructs (see Table 1). The scale validity in measuring customer perceptions of service quality was observed and ensured in Hanzaee and Salehi (2011), Ravichandran et al. (2010), and Siddiqui (2010). The pilot study, which was designed to test the survey instrument, also conrmed the face validity of the survey questions to measure customer perceptions of retail banking services in Vietnam. In order to reduce 22 survey items of quality dimension to a smaller number of factors for modeling and to validate the SERVPERF model in the

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TABLE 1 Cronbachs Alpha Measurements Item 1. Has up-to-date equipment 2. Should do as promised 3. Should tell when services will be performed 4. Employees who are trustworthy 5. Individual attention to customers 6. Appealing physical facilities 7. Interest in solving customer problems 8. Prompt service to customers 9. Customers feel safe in transactions 10. Convenient operating hours 11. Neat-appearing employees 12. Perform service right the rst time 13. Always willing to help customer 14. Consistently courteous with customers 15. Employees give personal assistance 16. Visually appealing service materials 17. Provide service at times promised 18. Never too busy to respond to request 19. Knowledgeable 20. Have customers best interest at heart 21. Insist on error-free records 22. Understand customers specic needs 23. Overall, I am very satised with this bank Scale Mean if Cronbachs Item Deleted if Item Deleted Cronbachs 113.61 113.51 113.97 113.96 113.94 113.77 113.44 113.82 113.94 113.85 113.63 113.64 113.96 113.55 113.86 113.71 113.49 114.00 113.90 113.84 113.51 113.89 113.54 .898 .897 .900 .897 .896 .899 .898 .899 .898 .902 .906 .901 .900 .901 .898 .901 .897 .901 .901 .898 .898 .899 .897 .903

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Vietnamese market, I used both exploratory factor analysis and conrmatory factor analysis (CFA). In CFA, the research approached structural equation modeling (SEM) by AMOS 18. SEM was used to explore the CFA measurement model. All 22 items were factor-analyzed using the Varimax method with a 0.6 loading cutoff point, resulting in ve factors totaling 16 items. The ve factors together contributed to a 72% effect on customer satisfaction (see Table 2). From the previous exploratory factor analysis, the nal SEM model extracted from AMOS 18 software included 16 items in ve service quality dimensions and overall customer satisfaction. The results of the CFA with the sample size of 394 respondents, shown in Figure 1, demonstrated a good model t to the data on the basis of a t statistic ( 2 = 162.28, df = 105, goodness-of-t index = .974, comparative t index = .981, root mean square error of approximation = .037). The current study provides a signicant contribution to the literature by conrming the ndings of other researchers (Hanzaee & Salehi, 2011; Lin & Hsieh, 2006; Olaleke, 2010; Cronin & Taylor, 1992) in a different population (Vietnam) based on a specic industry (banking). The structural equation model appeared to conrm the importance of customer satisfaction in retail banking services (see Figure 1). The straight lines (in the SEM model) with

Service Quality and Customer Satisfaction TABLE 2 Rotated Component Matrix Component Loading Dimension Tangibility Reliability 6. 10. 2. 7. 17. 21. 3. 13. 18. 4. 9. 19. 5. 15. 20. 22. Item Appealing physical facilities Convenient operating hours Should do as promised Interest in solving customer problems Provide service at times promised Insist on error-free records Should tell when services will be performed Always willing to help customer Never too busy to respond to request Employees who are trustworthy Customers feel safe in transactions Knowledgeable Individual attention to customers Employees give personal assistance Have customers best interest at heart Understand customers specic needs 1 2 3 4

205

5 .781 .879

.820 .770 .789 .806 .816 .829 .727 .809 .815 .850 .826 .743 .704 .781

Responsiveness

Assurance

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Empathy

one arrowhead showed that service quality dimensions were antecedents of customer satisfaction. As bank leaders invest in retail banking services and expect customers to continue using them and refer their friends, bank leaders may have to rst provide quality services to obtain customer satisfaction.
.75
e1

Q6 Q10

.41 .64

.87

e11

Tangible

Chi-square= 162.286; df= 105; P = .000 Chi-square/df = 1.546 TLI = .975; CFI = .981 RMSEA = .037
.47

.70
e2 e7 e12 e21

Q2 Q7 Q17 Q21

.51 .65 .61 .81 .78

.84 .72

.16

Reliability

.30

e23
.28 .39 .33 .39

.75
e3 e13 e18

Q3 Q13 Q18

.58 .33 .76 .58

.87

Responsiveness

.48

.56.08

Overall Satisfaction
.55 .56 .01

.85
e4 e9 e19

Q4 Q9 Q19

.63 .49 .70

.92 .79

Assurance

.36 .25

.79
e5 e15 e20 e22

Q5 Q15 Q20 Q22

.44 .47 .44 .66 .53 .73 .89 .69

Empathy

FIGURE 1 Structural Equation Model. TLI = Tucker-Lewis index; CFI = comparative t index; RMSEA = root mean square error of approximation.

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TABLE 3 Descriptive Data on Service Quality Dimensions Dimension Tangibility Reliability Responsiveness Assurance Empathy Valid N (listwise) N 394 394 394 394 394 394 Min 2.00 2.75 2.67 2.00 2.00 Max 7.00 7.00 7.00 7.00 7.00 M 5.1117 5.4365 4.9442 4.9915 5.0431 SE .05064 .04597 .04280 .05320 .04968 SD 1.00519 0.91258 0.84958 1.05593 0.98609

Descriptive Data Analysis

The present model included ve service quality dimensions: tangibility, reliability, responsiveness, assurance, and empathy. Descriptive statistics on service quality dimensions showed that reliability had the highest mean and a lower standard deviation (M = 5.44, SD = .91). The responsiveness dimension was perceived lowest (M = 4.94, SD = .85). All service quality dimensions in Table 3 were perceived higher than average, with mean values greater than 4 (neutral). Customer satisfaction is the degree to which a customer believes that the use of a service evokes positive feelings (Rust & Oliver, 1994). Table 4 shows that 328 (83.20%) respondents gave a positive response to the survey item Overall, I am very satised with this bank. Approximately 66 (16.8%) of the respondents did not agree with or were neutral toward this item. This result appeared to indicate high satisfaction among respondents toward retail banking services offered by banks in Vietnam. These ndings raised a question with the study problem statement that one of the main concerns for the underdeveloped banking industry in Vietnam is the inadequate service quality in the retail sector (BMI, 2011; SBV, 2011). However, these ndings seemed to add signicance to the conclusions.

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Correlation Analysis
The interrelationships of perceived service quality dimensions in the study were also investigated through correlation analysis. This section involves
TABLE 4 Descriptive Statistics of Overall Satisfaction Response Valid Disagree Indifferent Agree Moderately Agree Strongly Agree Total Frequency 9 57 139 151 38 394 % 2.3 14.5 35.3 38.3 9.6 100.0 Valid% 2.3 14.5 35.3 38.3 9.6 100.0 Cumulative% 2.3 16.8 52.0 90.4 100.0

Service Quality and Customer Satisfaction TABLE 5 Correlations Between Service Quality Dimensions Dimension 1. 2. 3. 4. 5. Tangibility Reliability Responsiveness Assurance Empathy 1 .365 .262 .253 .429 2 .351 .387 .475 3 4

207

.431 .306

.381

Signicant

at the .01 level (two-tailed).

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answers to Research Question 1. The hypotheses for Research Question 1 were formulated to determine whether there would be signicant differences in customer perceptions within particular service quality dimensions, as measured by the SERVPERF model. These dimensions include assurance, reliability, tangibility, empathy, and responsiveness. Pearsons correlation analysis was used to test the following hypotheses:
H10: There is no statistically signicant correlation between dimensions of perceived service quality among retail banking customers in Vietnam. H1A: There is a statistically signicant correlation between dimensions of perceived service quality among retail banking customers in Vietnam.

All correlations were found to be statistically signicant (p < .001, twotailed), with positive linear associations among the ve independent variables in Table 5. Ten interrelationships existed between the ve dimensions of service quality, ranging from .253 (tangibility and assurance) to .475 (reliability and assurance). The moderate relationships included those between tangibility and reliability, tangibility and empathy, reliability and responsiveness, reliability and empathy, responsiveness and assurance, assurance and reliability, and assurance and empathy, with correlation coefcient r > .35. Correlation analysis conrmed that all ve service quality dimensions were signicantly related. H10 was rejected at an alpha level of .05. It was concluded that there was a statistically signicant correlation between dimensions of perceived service quality among retail banking customers in Vietnam.

Multiple Regression Analysis

Multiple regression analysis was utilized to investigate the relationship between service quality dimensions (independent variables) and customer satisfaction (dependent variable), answering Research Question 2. The hypotheses for Research Question 2 were designed to assess the relationships between overall customer satisfaction and service quality dimensions:

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TABLE 6 Correlation Between Service Quality and Customer Satisfaction Dimension Overall Satisfaction Tangibility .411 Reliability .507 Responsiveness .318 Assurance .336 Empathy .514

H20: There is no statistically signicant correlation between overall satisfaction and perceived service quality among retail banking customers in Vietnam. H2A: There is a statistically signicant correlation between overall satisfaction and perceived service quality among retail banking customers in Vietnam.

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The results showed that 328 (83.20%) respondents gave a positive response to the survey item Overall, I am very satised with this bank. Approximately 66 (16.8%) respondents did not agree with or were neutral toward the item. This result indicated high satisfaction among respondents toward retail banking services offered by banks in Vietnam. Each of the ve service quality dimensions had a signicant positive bivariate correlation in the study. The values of univariate correlation (r) between overall satisfaction and the ve service quality dimensions (tangibility, reliability, responsiveness, assurance, and empathy) were .411, .507, .318, .336, and .514, respectively, as shown in Table 6. The ndings in Table 7 conrmed a signicant model that explained 38.6% of the variance in satisfaction in terms of tangibility, reliability, responsiveness, assurance, and empathy. This means that 61.4% of overall satisfaction could not be explained by service quality dimensions. Furthermore, the study involved evaluating a multiple regression model in an attempt to predict customer satisfaction in terms of service quality dimensions in a combined model (see Table 8). The regression equation was formed as follows: overall satisfactioni = 1.196 + (.150 tangibilityi + .276 reliabilityi + .080 responsivenessi + .048 assurancei + .255 empathyi ) The current study found empirical evidence to support a signicant positive linear relationship between service quality dimensions associated with
TABLE 7 Multiple Regression Model Summary Change Statistics Model R 1 R2 SE of the DurbinEstimate R 2 Change F Change df 1 df 2 Sig. F Change Watson .386 48.762 5 388 .000 1.967

.621 .386 .731

Service Quality and Customer Satisfaction TABLE 8 Collinearity Diagnostics Unstandardized Coefcients Model (Constant) Tangibility Reliability Responsiveness Assurance Empathy B 1.196 0.150 0.276 0.080 0.048 0.255 SE .289 .042 .049 .050 .041 .046 Standardized Coefcients .163 .271 .074 .055 .272 T 4.146 3.592 5.647 1.618 1.171 5.564 Sig. .000 .000 .000 .017 .042 .000

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Collinearity Statistics Tolerance .773 .685 .761 .721 .664 VIF 1.294 1.461 1.315 1.388 1.506

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customer satisfaction. H20 was rejected. It was concluded that there was a statistically signicant correlation between overall satisfaction and perceived service quality among retail banking customers in Vietnam. Though all ve dimensions were signicant determinants of customer satisfaction in banks in Vietnam, reliability and empathy were the most important factors.

RECOMMENDATIONS
As labor costs continue to increase, increasing service quality offers obvious cost benets to the banking industry in Vietnam. The literature indicates a high correlation between customer satisfaction and protability (Anderson, Fornell, & Lehmann, 1994; Wan, Luk, & Chow, 2004). Bank leaders need to leverage factors associated with customer satisfaction to increase profitability. The use of retail banking services offers cost benets that can also contribute to protability. For bank leaders to effectively achieve protability, they need to continuously improve all service quality dimensions discussed in the present study, namely, tangibility, reliability, responsiveness, assurance, and empathy. More specically, bank leaders can predict customer satisfaction based on tangibility, reliability, responsiveness, assurance, and empathy dimensions, which together explained 38.6% of customer satisfaction. The ndings of this study can also help practitioners and business leaders prioritize service quality dimensions when implementing development plans to improve retail banking services. The ndings of the study can signicantly improve quality development plans, such as failure modes and effects analysis, total quality management, or quality by design. The current study showed that all service quality dimensions were positively correlated with customer satisfaction. However, reliability and empathy ranked higher than the other dimensions, with signicant contributions of .28 and .26 in the multiple regression model. Bank leaders need to consider service reliability when setting up development plans for retail banking services. Employee and customer interactions are reected through the

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empathy dimension (Siddiqui, 2010). Therefore, bank leaders in Vietnam are well advised to emphasize employee training programs so that they can offer personalized service to customers. Bank leaders might focus on providing more control and personalization to employees and increasing their ofce hours and ATM network coverage to capture customer interests in their offerings. This result reveals that 61.4% of overall satisfaction cannot be explained by service quality dimensions but by other aspects. Future research should discover other factors affecting customer satisfaction in the retail banking sector in Vietnam. For instance, future research should perceive other factors, such as pricing programs, levels of market standardization, or cultural preferences. In addition, the present study involved examining service quality dimensions associated with overall satisfaction among current retail banking customers. However, the study did not examine dimensions associated with customer loyalty and new customer acquisition. High customer satisfaction is important in maintaining a loyal customer base (Siddiqui, 2010). Customer loyalty relates to what customers think and do in the future with the services. Customer acquisition is concerned with increasing market share and recruiting new customers. These two concepts are beyond the scope of the study. Additional research into customer loyalty and customer acquisition would provide more insights into service quality and customer satisfaction in the retail banking sector in Vietnam. Future research might leverage the ndings of the current study in light of those found by Cronin and Taylor (1992) by enhancing the survey instrument. Future research will provide additional thoughts toward understanding consumer behavior toward services, whether in banking or any other industry, and in Vietnam or any other country. The current model appears to t previous ndings in the United States, but future researchers might replicate the service quality model in retail banking services in other countries to check whether the ndings match. As retail banking services continue to develop, there might also be a need to reinvestigate these ndings. Future research may also involve investigating how cultural differences might inuence customer perceptions of service quality. A future concern is the potential for alternative methods of service quality measurements in the research context of interest here. Banking services in Vietnam are not as sophisticated as those in North America or other developed countries. Vietnamese customers have just begun recognizing the benets of improved banking service quality. Yet presently their demand for service dimensions is still very limited, and their tolerance for poor service quality appears to be high. They seem to be more concerned with the process of delivery than the outcomes of service, which is indicated in the high results in the ve service quality dimensions in the present study. Future research may need to focus on comparisons of SERVPERF with other, more extended methods, such as Bank service quality (BSQ) (Bahia & Nantel, 2000), SYSTRA-SQ

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(Aldlaigan & Buttle, 2005), or BANQUAL-R (Tsoukatos & Mastrojianni, 2010). A focus on broad service dimensions tends to be benecial for bank managers in the long run. It allows identication of and response to customers priority problem areas and other service demands.

SUMMARY
The main objectives of the present study were to assess the service quality dimensions (tangibility, reliability, responsiveness, assurance, and empathy) and to examine the relationship between service quality and customer satisfaction in the retail banking sector in Vietnam. The data indicated that both customer demographic identity and bank characteristics were signicantly related to perceived service quality (p < .05). In addition, the ndings conrmed that the ve quality dimensions were signicantly interrelated. Finally, service quality was found to be positively correlated with, and to explain 38.6% of, customer satisfaction in the retail banking sector in Vietnam. The ndings of the study can help practitioners and business leaders prioritize service quality dimensions when implementing development plans to improve retail banking services. In addition, research indicates that service quality and customer satisfaction correlate with protability (Anderson et al., 1994; Wan et al., 2004), loyalty (Fornell, 1992), and positive customer behavior intention (Zeithaml, Berry, & Parasuraman, 1996). The leadership of banks in Vietnam might benet from the study ndings and might increase protability through increasing customer satisfaction and service quality.

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REFERENCES
Aldlaigan, A., & Buttle, F. (2005). Beyond satisfaction: Customer attachment to retail banks. International Journal of Bank Marketing, 23(4), 349359. Anderson, E., Fornell, C., & Lehmann, D. (1994). Customer satisfaction, market share, and protability: Findings from Sweden. Journal of Marketing, 58(3), 5367. doi:10.2307/1252310 Bahia, K., & Nantel, J. (2000). A reliable and valid measurement scale for the perceived service quality of banks. International Journal of Bank Marketing, 18(2), 8491. Beerli, A., Martin, J. D., & Quintana, A. (2005). A model of customer loyalty in the retail banking market. European Journal of Marketing, 38(1/2), 253275. Business Monitor International. (2011). Vietnam commercial banking report: Q1 2011. Retrieved from www.businessmonitor.com Cooper, D. R., & Schindler, P. S. (2008). Business research methods ( 10th ed.). New York, NY: McGraw-Hill. Creswell, J. W. (2008). Educational research: Planning, conducting, and evaluating quantitative and qualitative research ( 3rd ed.). Upper Saddle River, NJ: Pearson.

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