The impact of Banking services quality on the financial performance of commercial banks A study of a sample of commercial banks operating in Algeria

Abstract

This research paper aims to study the impact of the quality of banking services on the financial performance of banks, considering customer loyalty as an intermediary variable between the quality of banking services and financial performance. A questionnaire was designed as a tool for collecting data from a simple consisting   512 customers of 5 banks operating in Algeria, to gather information regarding customer loyalty and service quality evaluated by the SERVQUAL model's five dimensions (tangibles, reliability, responsiveness, security and empathy), while financial performance data was attained from the annual reports of the 5 banks (return on equity and return on assets). The results of the field study showed a positive statistically significant impact of the dimensions of banking services quality (tangibles, responsiveness, security and empathy) on customer loyalty, except the dimension of reliability, the results also showed that there is an impact of customer loyalty on the financial performance of the banks measured by the return on equity, while there is no impact of customer loyalty on the financial performance of these banks measured by the return on assets