Factors influencing a bank’s competitive ability: The case of Lithuania and Latvia
Factors influencing a bank’s competitive ability: The case of Lithuania and Latvia

Summary/Abstract: Research background: A commercial bank’s competitive ability is of great importance as it plays a vital role in ensuring a bank’s success; hence, it is necessary to identify the factors that contribute to the development of competitive advantage of commercial banks and to shift competitive ability to a higher level. The competiveness of banks is assessed from customers’ perspective, highlighting the main factors that influence them in choosing a particular bank. Purpose of the article: The paper aims to assess the determinants influencing bank’s competitive ability from customers’ perspective by indicating the level of their influence. The following objectives are set: to distinguish the determinants influencing commercial bank’s competitive ability, to prepare a methodology for the assessment of factors, to evaluate the importance of the factors using expert evaluation method based on fuzzy analytic hierarchy process. Methods: A questionnaire was prepared for the experts in order to collect the data; fuzzy analytic hierarchy process was implemented for processing the data. Findings & Value added: The research was conducted in Latvia and Lithuania at the beginning of 2017. The results showed that the most important factor for bank’s competitive ability in both — Lithuania and Latvia — is customers’ trust. Reliability of the bank (both in Latvia and Lithuania) and the privileges of loyal customers (only in Latvia) have gained experts’ attention as well. The proposed model of bank’s competitive ability allows to evaluate the level of bank’s competitiveness effectively, which would help the bank to plan its activities successfully and attract new customers in order to take the leading position in the market.

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