A Theoretical Model for Strengthening Bank Reputation in Myanmar During Crisis

Abstract

This paper attempts to construct a theoretical model for amending the impairment of bank reputation and extend the knowledge for policymakers and managers of private banks regarding the essential factors to consider in building a more substantial bank reputation, particularly during the irregular period in banking sector. The quantitative research approach was employed, and randomly selected 350 private bank customers participated in this study. The questionnaire items were analyzed using partially exploratory factor analysis (EFA) and partially confirmatory factor analysis (CFA). The hypotheses were estimated and examined using the structural equation modeling (SEM) technique. According to the results, structural assurance (β=0.738, p<0.001) and financial assurance (β=0.367, p<0.001) had a significant positive effect on service quality. Moreover, service quality positively affected perceived value (β=0.520, p<0.001), communal influence (β=0.765, p<0.001), and bank reputation (β=0.592, p<0.001). Further, perceived value (β=0.284, p<0.05) and communal influence (β=0.122, p<0.05) with regard to private banks all evidenced a positive direct effect on bank reputation. Therefore, this study statically confirmed the roles of structural and financial assurance in improving service quality and service quality outcomes (perceived value and communal influence), leading to a more incredible bank reputation.