3.0 Market Conduct of Bank Industry

The marketing mix is the general phrase used to describe the different kinds of choices organisations have to make in the whole process of bringing a product or service to the market...

as the first governor. The main duties and responsibilities of the Central Bank were to promote economic development and maintain internal and external monetary stability. The Central Bank extensively regulated the commercial banking system and engaged in considerable rediscounting activity. Interest rates were set usually below the market clearing rate. Commercial bank lending tended to be short-term and granted to known and established clients. The system had periods of instability with several bank runs and a few failures. In 1980, at the instigation of the World Bank and the IMF, several measures were passed to increase competition in the financial sector, achieve greater efficiency, and increase borrowers’ access to long – term funds. Large banks with a net worth of at least P500 million could engage in expanded commercial banking, or “unibanking”, combining commercial and investment banking activities. In 1988 there were eight unibanks, including the Philippine National Bank. Further liberalization had occurred in 1983 when interest rate shifted from being administered to being market-determined. Most agree that better economic outcomes are achieved when interest rates are market-determined. Market-determined rates allow investors and savers to base their decisions on market conditions and the scarcity of capital and also provide policymakers with clearer signals of market conditions.

Point of Difference, are service benefits or attributes that customers associate positively with a brand, which they believe would not be found, at least to the same extent in other competitive brands. Point of Parity, on the other hand, are associations that are not necessarily unique to the brand and may be shared with other competing brands. These are attributes that represent necessary, but not necessarily sufficient conditions for brand choice.

The objective of the Banking & Financial Institutions Act, 1989 (BAFIA) is "to provide new laws for the licensing and regulation of the institutions carrying on banking, finance company, merchant banking, discount house and money-broking business, for the regulation of institutions carrying on certain other financial businesses, and for the matters incidental thereto or connected therewith".BAFIA was introduced to provide for an integrated supervision of the Malaysian financial system and also to provide the Central Bank with the power to speedily investigate and prosecute, if necessary any illegal activities in an attempt o reduce white-collar crime.

Bank Negara Tanah Melayu was set up in January 1959. One of its main responsibilities is to supervise all activities of commercial banks in Malaysia through the Banking Ordinance 1958 which was super-ceded by the Banking Act 1973. With the formation of Malaysia on 16th September 1963, Bank Negara Tanah Melayu came to be known as Bank Negara Malaysia (Central Bank of Malaysia). Bank Negara Malaysia is a statutory body which started operations on 26 January 1959. It was governed by the Central Bank of Malaysia Act 2009. Its headquarters is located in Kuala Lumpur, the federal capital of Malaysia. Bank Negara had previously maintained branches in each of the state capitals. Most of them were closed in the 1990s when retail banks began taking over most of the counter services. There are still branches maintained in Penang, Johor Bahru, Kota Kinabalu, Kuching,

Just like most of the countries, Malaysia also has our own central bank which has the monetary authority to oversea the financial system and the economy which is known as Bank Negara Malaysia (BNM). BNM was established on 24th January 1959 and Central Bank of Malaya Ordinance was provided the licensing and regulation of the business of banking in the Federation of Malaya. As time passed, BNM grew stronger and has more authority, supported by several act to ensure the stability of Malaysia Financial System. Currently, the bank is active in developing financial inclusion policy and is an important member of the Alliance for Financial Inclusion. The current governor of BNM is Tan Sri Muhammad bin Ibrahim who assumed the office of Governor on 1st May 2016, succeeding Dr. Zeti Akhtar Aziz.

Marketing of an financial institution is different from other industries. A Financial institution has a very unique product range. Lets take a credit card as an example: You have done the market research, using focus groups, surveys and on-line market-research to identify the features that will be of value to your target market. To differentiate your product from competitors you will identify the advantages and communicate them to the prospective clients. This is all classic product marketing.

The structure of the bank is such that as a public entity it has the power to issue policy rules and regulations which are binding to the public at large. As a civil entity, the Bank Indonesia is able to represent itself in and Outside the court of law. The Board of the Governors is a organization responsible for formulating and

It initiated the policy discussions with regard to providing new bank licenses, designing the road-ahead for the presence of foreign banks and holding company structure for banks

The study of foreign bank entry effect towards domestic banking in Malaysia in term of long term loan is an important tool to evaluate the difference between foreign bank and domestic bank in Malaysia. Other than that, it is also important to determine management planning and strategic analysis. Banks contribute to economic growth, so if the bank performance is outstanding, the overall economy will be strong. There are few studies have discussed the similar topic. Therefore, some of the articles are selected as a references.

Today, its vital role in commercial banking activities lie in the direct effect it has on total economic growth and business development. Every year the (CBN) central bank of Nigeria being the monetary authority that is solely responsible for the insurance of guidelines policies and the interpretation of such, comes up with economic measure roles and regulation under which the bank in the country operate. Such policies direct the use of funds from depositors, stockholders, and creditors in order to control the size of loan portfolio thereby determining the general circumstances under which it is appropriate to make an advance. The monetary policies also aim at aiding the banks to maintain a sound financial and banking system promote confidence in sustenance of reasonable banking services for public as well as ensuring a high standard of conduct and professionalism in banking industry. These rules and regulations are contained in monetary policy circular being issued by the central bank at the beginning of every year.

Every bank will have to get the permission of the Reserve Bank before it can open a new branch. Each scheduled bank must send a weekly return to the Reserve Bank showing, in detail, its assets and liabilities. This power of the Bank to call for information is also intended to give it effective control of the credit system. The Reserve Bank has also the power to inspect the accounts of any commercial bank.

When Bangladesh came into existence on the 16th December, 1971, the banking sector of Bangladesh was in a total disarray. With the exception of two local banks incorporated in then East Pakistan, all the bigger local banks became inoperational.. Starting with such a humble  condition, the Banking Sector of Bangladesh has grown to a

Due to the inflation, Malaysia government already applied different strategies to face the inflation that occurred recently. Bank Negara Malaysia controls the inflation rate by implementing the monetary policies such as influence the level of interest rate that commercial banks have to pay on their loans. Sometimes commercial banks have unexpected or urgent needs for extra funds, Bank Negara Malaysia will make a short term loan to them in such case. Acceptable collateral and a promissory note (IOU) such as government securities are given when commercial banks borrow. Bank Negara Malaysia will obstruct commercial banks to make loan from them for obtaining additional funds when the inflation

Bangladesh Bank fully guides the banking industry in our country. However, different types of banks have