Awareness Of Libyan Customers

Published Date: 02 Nov 2017

1.1 Introduction

The services sector is the most significant sector, which contributes largely to the national economy in Libya; the banking service is an important component of services sector. It has been so due to the increased significance of financial services in the recent years, a number of private sector and foreign banks have entered the Libyan market and made it more competitive. The onset of competition from the private players and initiation of banking reforms since early have led to an increased emphasis on efficient customer service. Moreover, the tough competitive arena in which these banks operate today, maintaining the quality of service is a pre – requisite for survival. Therefore, measurement of service quality has increasingly created an interest among the service providers (banks) and scholars (Sharma,A; Mehta, V. 2005). So measuring the quality of services provided to customers by banks is one of the topics that carry high importance in management area; particularly in dealing with business organizations that value quality services. Many researchers studied the quality of services and determined the dimensions corresponding to the overall quality of service. They have overall agreed that the quality of service is considered a measure of the degree to which the level of service would reach customer expectations. However, many organizations careless about applying these studies; which broadened the gap between the service provided to customers and service expected from the customers’ perspective.

Nevertheless, in order to achieve superiority, competition between organizations had led them to achieve excellent services. That is by setting strategies to satisfy customers’ needs, desires and gain their loyalty. Other strategies include setting high standards for quality services and a system for monitoring service delivery and its relevance to customer expectations in order to realize their consent whereas the banking sector is one of the most important sectors affecting the economic activities in various countries as it provides financial support to individuals and organizations that contribute in financing several projects required by the government to support the economy and increase the financial returns of its various institutions.

In this study the researcher will analyze the views of customers dealing with the banking sector in Libya to understand the relationship between customers’ satisfaction of banking services and their trust. This is by identifying whether customers expectations for the service and the actual performance of the service provided by the employees are corresponding.

And the Libyan banking sector consists of several banks some of them specialized and which aimed at social development such as bank savings and real estate investments, Agricultural Bank, Rural Bank and Development Bank, and also there are many private banks such as Mediterranean Bank, United Bank for Trade and Investment, Bank of the Arab Consensus, Trade and Development Bank, AL-Aman Bank, Al-Sarai Bank, Arab Commercial Bank and Al-Wafa Bank. And there is only one bank specialized in financial businesses at abroad and to perform some banking at abode it's Libyan foreign bank. Also there are many commercial banks such as republic Bank's biggest bank in Libya, unity bank, National Institutional bank, National Commercial Bank and Sahara Bank. But there are three banks opened windows Islamic bank (republic Bank, unity Bank and Sahara Bank).

1.2 -Problem of the Study

The success of commercial banks in achieving their objective of being able to gain new customers while maintaining their existing ones in this highly competitive environment certainly requires them to measure the customer satisfaction and quality of service performance. This shows that all types of commercial banks, should improve their service quality in order to overlap with clients’ expectations (Okan Veli Safakli 2006). So, all the organizations in this modern era are interested in modern marketing and aim to fulfill the demands and wishes of their customers so by providing better banking services.

This study is an attempt to identify the views of customers dealing with banks in Libya. It is to determine the degree of satisfaction with the services provided to customers and identify the condition of the current services. Moreover, the study aims to know whether services provided conform to the customers’ expectations. The study also wishes to know the possibility of customer awareness to the services by the banks.

The dimensions of the problem can be summarized as follows:

• Banks are not aware of the level of satisfaction and quality of services provided to the customers.

• Fewer services provided to customers had widened the gap between the perceived performance and the expected performance.

• There is a lack of a clear policy in dealing with customers.

1.3-Research questions

This study attempts to answer the following research questions:

1- What is the awareness of Libyan customers on the interest-free banking in the Islamic windows in commercial banks?

2- What are the dimensions of the expected quality of customer service in the Islamic windows in commercial banks?

3- What are the dimensions of the perceived quality of customer service in the Islamic windows in commercial banks?

4- Are there any differences between expected quality and perceived quality by the customer in Islamic windows in commercial banks?

5- What is the level of customer satisfaction and customer awareness across demographic variables like (Gender, Age, education, Occupation, Monthly income and marital status)?

6- What is the relationship between service quality and customer satisfaction?

1.4-Objectives of the Study:

This research examines customer satisfaction with the services provided by the window Islamic in commercial banks in Libya. The research seeks to achieve the following objectives:

1- To study the awareness of Libyan customers on the interest-free banking in the Islamic windows in commercial banks.

2- To examine the dimensions of the expected quality of customer service in the Islamic windows in commercial banks.

3- To examine the dimensions of the perceived quality of customer service in the Islamic windows in commercial banks.

4- To study the relationship between expected quality and perceived quality by the customers in the Islamic windows in commercial banks.

5- To examine the difference in customer satisfaction and customer awareness across (Gender, Age, education, Occupation, Monthly income and marital status) in the Islamic windows in commercial banks.

6- To study the relationship between service quality and customer satisfaction in the Islamic windows in commercial banks.

1.5-Importance of the study:-

The practical side of the study is concerned about marketing and management in this current period. It is considered as a governing factor in this strongly competitive environment especially in the coming years.

The importance of research is represented in the following points:

1. The significance of the study stems from its effort to shed light on an apparent lack of measurement and analysis of the quality of banking services from the customers’ perspective. Also to shed light on the nature of Islamic windows in commercial banks in Libya and the challenges confronting them in the current circumstances of open markets and globalization.

2. The explain the impact of customers’ satisfaction level of banking services Performance and their tendency to repeat their transaction as it would help banks to assess customers needs' and attract new ones.

1.6-Limitations of the study:-

substantive limits of the study:-In view of the fact that the study will examine the customer satisfaction in Islamic windows in commercial banks operating in Libya, and taking into account the constraints of time and cost, other topics pertaining to Islamic banks, such as customer awareness to the service provided by these banks, In addition, to examine the difference in customer satisfaction across (Gender, Age, education, Occupation, Monthly income and marital status). The study will attempt to evaluate the experience of Islamic windows in commercial banks in the Libya in general. Therefore, the study will deal with Islamic windows in commercial banks that have branches distributed in the Libya.

The location of the study:-researcher will choose the capital City of Libya (Tripoli) for the application his study, because Tripoli represent one-third of Libya. And most resident in Tripoli came from other cities.

Time limits of the study: - the study will take three years to complete it. And the thesis has been started in July 2009.

1.7-Outline of the study

Chapter One: General Research Framework, this chapter which consisted of Introduction, Problem of the study, Research questions, Objectives of the study, Importance of the study, Limitations of the study and outline of the study.

Chapter Two: Literature Review, this chapter includes Introduction, An overview of the Libya banking industry, previous studies, definition and concepts Service Quality, The perception of service quality, service quality Expectation, customer satisfaction, The relationship between service quality and customer satisfaction, service quality Dimensions, service quality Gaps, The antecedents of service quality Gaps, the SERVQUAL model and Development studies and measuring service quality in the banking sector.

Chapter three: methodology of the study, this chapter covers the methodology and consists from model of the study, Variables used and results to justify this model, Explain what is the advantage of this model as compared to another models, The study hypotheses, The approaches are will use in this study, The questionnaire design, Sampling, Data collection method and analytical methods.

Chapter four: covers the analyses and findings

Chapter five: conclusion.

Chapter two

Review of the banking work in Libya

2-1 Central Bank of Libya

Central bank of Libya is the monetary authority in Libya, and being as an independent financial institution which owned wholly by the state. The Act of the establishment of the central bank and the subsequent laws was determined the objectives of the central bank which is the latest banking (Act No.1 of the year 2005), this is to maintain monetary stability and to work towards growth in the national economy within the framework of the general policy of the state. The board of directors of the central bank of Libya deals with the administration of regulations that relating to its operations and internal financial and administrative affairs. The Governing Council consists of the Governor as Chairman and Deputy Governor as Vice-Chairman and the number of six other members, and the Governor is the chief executive of the bank is managed by the regular conduct of affairs under the supervision of the board of Directors.

The Central bank of Libya started at the first of April 1956, by but backs the Libyan monetary Committee (LMC), which was established in 1951. Therefore, the function of the LMC was to keep up the cover of the exporting currency by sterling assets and did not have any role at the beginning of this activity in controlling of money supply, credit banking or in the managing of banks.

Along with time, the power of the central bank of Libya was expanded to acquire the purposes and function which indicated as follows:-

1-To organize and issuance the notes and coins currency.

2- To maintain the stability of the Libyan currency at abode and abroad.

3- To manage the state reserves of gold and foreign currency.

4- Organizing of credit banking in terms of size, type and price to ensure that it will face the real needs of economic growth and monetary stability.

5- Take the necessary measures to address the economic or financial disturbances that should be international or domestic.

6- Working as a bank for the commercial banks.

7- Controlling of commercial banks and to ensure the reliability of their financial performance and efficiency of control and to ensure the rights of its customers.

8- Working as a bank and as the principal for the state and its public institutions.

9- Providing advice to the state in terms of planning and evaluation of economic and fiscal policy.

10- Foreign exchange control.

11- To carry out the tasks or processes which are usually carried out by any central bank and another and holding any functions may be assigned under the banking Act or any international agreements to which the state is being as a partner.

12- To issuance and managing of loans that set by the state.

The following evolution clarifies the total assets of the Central Bank of Libya and the official reserves of foreign currency (in million Libyan dinars).

Table (2.1): Illustrate the total assets of the central bank and the official reserves of foreign currency (in million dinars).

years

2004

2005

2006

2007

Total assets

36216.7

58416.9

83682.1

106409.9

Official reserves of foreign currencies

131336.1

52711.3

75480.5

97270.1

Source: Website Central Bank of Libya

2-1-1- The main functions of the Libyan central bank

1-Issuance and organizing of currency:-

The national currency unit is the Libya dinar which was divided by a thousand dirham’s, and the bank announces the Libyan dinar exchange rate against foreign currencies in accordance with the change of such currencies against the special withdraw right (SWR).

The Central Bank of Libya is a legally authorized to issue the national currency (Notes and Coins) and are usually covered the exporting currency for trading by gold and foreign currency which can be changed.

Table (2.2): explain the development of export currency (in million dinars)

Years

2004

2005

2006

2007

Currency Issued

2794.7

3482.1

4134.5

4952.4

Source: Website Central Bank of Libya

2- Managing of reserves and controlling foreign exchange:

The Central Bank of Libya has keep up manages the reserves of gold and foreign exchange and chooses the appropriate tools of investment and the value that is being invested from all its work, taking into account the developments in exchange rate and in financial markets so as to guarantee the safety and profitability of these investments. The Central Bank allows the commercial banks to keep up the foreign assets in accordance with instructions that issued from time to time. Also, the central bank of Libya made a light monitoring towards the foreign exchange and liberalization of the account, in order to strengthen the economic stability and the stability of the overall level of prices.

3- State Bank:

Central Bank of Libya becomes as a fiscal agent of the state, where can be able to maintain the accounts and income and the expenses of the general secretariats and also can paying collecting and transferring of funds domestically and externally, along with managing the operations of a letters of confirmation on behalf of its clients and providing banking services to public institutions.

4- Bank of Banks:

The Central Bank of Libya maintains the compulsory money reserve which request from the commercial banks as a deposits proportion of their customers. In addition to that, the central bank accepts a deposits instance from these banks in return as benefits. The Central Bank of Libya is as the last alternatives for commercial banks which can grant unusual loans towards facing any exceptional circumstances that threaten monetary and banking stability in Libya.

5- Monitoring and regulating banking activity:

The Central Bank of Libya examines and analyzes the financial positions of commercial banks and to ensure that they maintain the required reserve ratios of cash and liquidity of compulsory process. The bank also monitors the commercial bank in implementation the credit and banking policy which set by the central bank, where the staff of the central bank inspects the commercial banks and their branches and examine the books and records to ensure the safety and accuracy of their financial statements referred to it, and the adequacy of banking services, The bank is also providing its services to commercial banks in the part of clearance instruments and in the field of credit risk.

6- The role of the Central Bank in economic development:

The direct role of the central bank of Libya’s in economic development should be clear through the assistance of financial institutions in attracting and directing the saving toward the financing of projects and production units, public and private service, and also contributes to the bank to strengthen the financial position of the state through the management of its reserves of gold and foreign currency. In addition, the bank plays an indirect role in economic development including the impact of embodied in the activity of commercial banks in particular through the control of the monetary mass, and also through the adoption of a monetary policy which might be capable of promoting domestic and foreign confidence in the strength and stability of the currency in the Libyan economy generally, as well as through the promotion of domestic savings by individuals and obsequious corporate in directing the investments in the productive and service sectors (Website Central Bank of Libya).

2-2- The Libyan Foreign Bank:-

The Libyan external bank established, "a Libyan assembly company" under the Act No. 18 of 1972 and the rule specifies the amount of capital of ten million Libyan dinars fully subscribed by the Central Bank of Libya, and authorized to the bank to work in various banking and financial businesses at abroad and to perform some banking at abode. The establishment of the law has been amended under the bank Act No. 16 of 1972, which increased the bank’s capital to 20 million Libyan dinars. There is a decision of general people’s committee (GPC) No. 887 in 1988 to increase the bank’s capital to 300 million Libyan dinars, with the beginning of the year 2006, and the rest of the enlarged planning has been paid which increased the capital to billion of U.S. dollars and now the bank capital reach up to ten billion U.S. dollars of wholly-owned by the Central Bank of Libya (Website the Libyan Foreign Bank).

The products and services offered by the bank:-

1-Banking operations

Opening accounts in foreign currency and accept deposits from abroad.

The collection of orders and bills of exchange and other valuable papers.

Issuance the instruments, bonds and warrants and other business documents.

2- International investment

The establishment of banks, institutions and companies and contributing to these institutions.

The purchase, sale and ownership of bonds and permits issued by or guaranteed by foreign governments or entities or international financial institutions.

Dealing with the market institutions of monetary and capital market instruments of sale and purchase.

The work of the agent with regard to the settlement of international transactions.

Investment portfolio management and advisory services.

3- International funding

The granting of loans of all kinds, and other credit facilities.

Department releases international loans and participation in.

Financing of foreign trade.

The financing of investment projects.

Carry out financial leasing.

4- Documentary credits

The issuance of letters of guarantee.

The availability of documentary credits and promotion, and circulation of documents, making collection.

2-3- The State-owned banks and specialized which aimed at social development

1-Bank savings and investment real estate:

The bank created under the provisions of law No.2 of the year 1981, as a contribution to Libya in the name of (bank savings and investment real estate) have a legal personality and savings bank has 28 branches (Website Bank savings and investment real estate).

The services provided by the bank stated as follows:

To encourage citizens to save for the provision of housing.

To promote cooperative housing.

The ranting of mortgage loans.

The issuance of bonds and investment certificates.

To accept deposits and real estate activity as determined by the statute of the bank.

Implementation and management of real estate projects.

Establishment of property ownership, and disposition.

The establishment of facilities or participate in real estate.

2- The Agricultural Bank:

Agricultural bank established Christians, 1955 and began operations in 1957 as a Christian, the only financial institution specialized in agricultural credit amounted to nearly half a century. It should be noted that the bank is a development financial institution serving the local agricultural sector and the animal within Libyan and has no branches of foreign bank activities and exercises during the current (45). (website Agricultural Bank).

The objectives of the Agricultural Bank:

1-provide various types of cash advances and in-kind contributions to the activity engaged in agricultural, animal, complementary activities and in particular:

The associations of agricultural cooperatives and breeders.

Engaged in agricultural activity and livestock.

Facilities and public companies engaged in the activity and because of agricultural and livestock.

Projects in the area of agricultural production and livestock.

2- The implementation of plans to support agricultural production and livestock.

3- Establishment of companies and enterprises related to the purposes for which the bank and participation.

4- Import the necessary actions to achieve the targeted objectives in the field of Agricultural and animal production.

5- To conduct necessary for the purposes of the bank from the sale and purchase and ownership of buildings and facilities and the acquisition of agricultural land, all in accordance with the law.

6- To other services related to agricultural and livestock production in accordance with the agreement made in this regard with the competent authorities.

3- Rural Bank

The rural bank is one of the pillars of the national economy and an important addition to other financial institutions operating in Libya and is aimed at further development of national production in all areas of productivity, professionalism and service, through stimulating and revitalizing low-income people who constitute the large segment of society and the establishment of banks to lend to law-income group for the purpose of investment and improve their living conditions.

Accordingly, the general people’s committee issued its decision to establish a public financial institution under the name (Rural Bank) managed the commission’s activities and exercises under supervision of the secretariat of the general People’s committee for finance and a capital of $(100) million Libyan dinars and may establish branches and offices in Libya (Website Rural Bank).

The objectives of the bank:

1-The granting of loans in cash and in kind to low-income individuals and participators in the areas of agricultural production and animal and marine and industrial and craft in the service area.

2- Provide assistance and technical advice for production projects, and professional service and help to achieve its purposes.

3- Declaring the investment opportunities, this can increase the standard of living for people with limited income and contribute to expanding the base of the economic activity of society.

4- Encourage low-income people to establish because in various areas of productivity and service.

5- Attract foreign investments and partnership in order to finance the capital projects in villages and rural areas.

6- The opening of deposit accounts of the beneficiary’s bank loans and the provision of banking services to them.

4- Development Bank

Although there is an abundance of financial state tended to think the end of the sixties to establish a banking financial institution shall be referred to the development of all productive sectors and the allocation of the budgets of the transition service to ensure the flow of financial accumulation to be able to finance investment projects of the economic feasibility of loans payable in installments are recycled in the financing of new projects have been developed and develop the idea to found the establishment of the development bank which has been the adoption of the law of slavery 8 m of the p- 1981 to finance investment projects of economic feasibility in the areas of industry, agricultural, tourism and service projects with a capital of ((100)) million and set the law and financial resources that including the amount allocated the annual budgets of the transition. Additionally, now the value of loans granted by the bank exceeds on billion Libyan dinars.

The table below illustrates the activities which financed by the Bank:-

Table (2.3) Mineral industries

Smelting and the formation of minerals

Turnery public workshops

Workshop lathe motor vehicles

Black-smiting

workshop

Empty boxes

Corrugated tin

The withdrawal of wire

Key and locks

Barbed wire

Nails and screws

Metal hinges

Silencers

Manufacturing aluminum doors and windows

Poles welding

Source: Website

Table (2.4) Food industry

olive presses

Bakeries

Biscuit making

Mills

Pastry industry

Fresh fruit

Desserts of all kinds

Canning fruits and vegetables

Milk and dairy products

Canning beans

Canning honey

Conservation and cooling of meat and fruit

Canning tomatoes

Fish canning

Source: Website

Table (2.5) Timber industry

Carpentry workshop

Office furniture industry

Home and school furniture

Source: Website

Table (2.6) Plastic and chemical industry

Paint industry

Medical plastic injection

Plastic bags

Of all kinds pipes

Different kinds of soap industry

Recycling of waste

Plastic boxes

Cover for greenhouses

Plastic portfolio

Plastic mats

Chairs and tables plastic

Mattress land

Vacuum cleaners and context

Mobilize and keeping bags of vegetables

Source: Website

Table (2.7) Textile industry

Wash and squeeze the wool

Ready-made clothes

Al-argent

Women’s cotton

Children pamper

towels

Source: Website

Table (2.8) Quarrying

Concrete mixers

Asphalt mixers

Quarries

Cut marble petrifaction

Cut and clear marble

Explain the masses of stone and marble

Brick industry

Concrete castings

Tiles land

Concrete blocks

Industry of bishop railway

Source: Website

Table (2.9) Leather and paper industries

Sports footwear industry

Leather footwear industry

Leather tanning

Eggs dishes industry

Napkins paper

Paper bags

Cardboard and packaging industry Keaton

Industry of school exercises books

Envelopes of paper industry

Source: Website

Table (2.10) Different kinds of transportation

General vehicles

Light transportation

Heavy transportation

Refrigeration transportation

Fuel transportation

Water transfer

Transfer of waste

Ambulances

Tourism transports

Source: Website

Table (2.11) general contracting

Construction and paving of roads

Drilling machines and the settlements of the soil

Heavy machinery

Mobile concrete mixers

Mechanical jacks and scafolding

Source: Website

Table (2.12) the services

Treatment clinics

Medical imaging laboratories

Medical laboratories

Photography, darkroom and printing lab

Computer and internet

Sports lounges

Cafes and restaurants

Maintenance workshop

Communications

Maintenance of tires

Car washing and lubricating stations

Advertising and propaganda

Public service

Drilling wells

Printing presses and binding

Central irrigation

Sinks of clothes and carpets

Accounting offices

Engineering offices

Tourist hotels

Galleries for social events

Maintenance of diesel pumps

Free education

Training services

Language labs

Fuel stations

Source: Website

2-4- State-owned banks and it is the commercial banks:-

1-The republic Bank:

It is on the integration of two banks with some of this integration on the bank of the existence of a unified budget shows more than 8 billion Libyan dinars, and the network of 146 branches of the branches, and thus one of the largest banks as it will Jamahiriya second after the Libyan foreign bank will be a surge in the banking business, as will be within the top ten banks in the region of the Maghreb and North Africa, according to the size of total assets in the year 2006 (Website republic Bank).

Services provided by the bank:

1-Individual banking services (Retail)

Open a saving account

Open a current account

Transfers within the Libyan state

Social finances

Credit facilities

Loans

Foreign remittances

Issuance of certified writing

Letters of guarantee

Documentary credit

The acceptance of graduate students and research projects (field training)

Foreign documents

Visa card issuance

Access to the library

Source: Website republic Bank

2- Corporate banking service

Transfers within the Libyan state

Open a current account

Issuance of certified writing

Credit facility

Documentary credits

Letters of guarantee

Foreign documents

Foreign remittances

Visa card issuance

Source: Website republic Bank

2- The Unity Bank:-

Bank of the Libyan joint-stock company established under law No.153 of the year 1970 issued on 12/22/1970. The bank capital paid one 108 million dinars Libyan have socioeconomic development fund 54.1% of the shares, the private sector 26,90% and the Arab bank 19% strategic partner (statistical,2008). Bank provides banking services of all kinds through the branches and agencies of a number of (74) the issuance of Law No. 153 of the year 1970 was the integration of five banks in a bank and one called (the bank). Was working than:

African, Arab banking company

Bank of North Africa.

The National bank of the convoy.

Commercial bank.

The magazine chose (Pennekras global) based in London has chosen the World Bank, the first unit of the great Jamahiriya in 2008. The bank of Libya bank sold its stake in the unit of trade amounting to 19% compared to 210 million Euros, the second largest of the privatization of commercial banks in the country. Unity bank and its assets are estimated at one billion and 700 million Euros.

Services provided by the bank:

1-Accept demand deposits and for the opening of current accounts.

2- The granting of loans to different deadlines, and other credit facilities.

3- Discount and rediscount of commercial papers and circulation.

4- Provide payment instruments, and other orders and bills of exchange, drawn from the clients or them, and collected.

5- Services for documentary credits, and making the collection of documents, letters of guarantee.

6- Issuance and management tools of payment, including the cash, and financial transfers, payment cards and credit, and instruments of tourism, and others.

7- Handling money market instruments, tools and capital market, both selling and buying account for or on behalf of clients.

8- Purchase and sale of debt, whether with or without recourse.

9- Finance leasing operations.

10- Dealing in foreign currency exchange markets and the immediate future.

11- Management of securities issues, and the commitment to coverage and distribution, and handling.

12- The provision of advisory services and other portfolio and the investment services, including fund management and investment to the detriment of others.

13- Management and conservation of the secretary of securities and valuables.

14- Secretary to provide services or financial advisor.

15- Real estate ownership and sale.

16- Any other work related to the banking activity that approves by the central bank of Libya.

3- Bank North Africa:

Banking institution established in accordance with the eligibility provisions of the commercial code and law No.9 of the year 1992 and law No.1 of the year 1993 on the banks, cash and credit has been the purpose of its establishment, supervision and control over the eligibility of banks and the follow-up of all the activity and coordination between them and the commercial banks and the central Bank of Libya and to provide technical advice and specialized banks, including the capacity to deal with banks and overseas financial institutions, in addition to the management of funds and financial resources allocated from the assumed and community banks in accordance with the eligibility rules and conditions specified by the Central Bank of Libya. The authorized capital of the institution has been identified at its founding by the amount of thirty-one million Libyan dinars.

However, by the implementation of Governing Council of the Central Bank of Libya decision No. 1 of the year 2006 turned to the civil institution of banking from the bank of banks operating in Libya, in accordance with the provisions of law No. 1 of the year 2005, on the banks and has been incorporated as a result of that (42) forty-two banks, which have the payments and at frequent intervals so that all the bank branches of the civil merged institution as the institution began to exercise all kinds of commercial banking business and provide all the services provided by other commercial banks has resulted in mergers increase the capital of the institution to the amount of $(108) one hundred and eight million Libyan dinars, as the total amount of assets one billion and three hundred and four million Libyan dinars.

Services provided by the Institution

1-Current accounts

2- Writing purchased

Currently the institution seeking to open up these services which identified as follows:

1-Fast money transfer service through the western Union Company

2- Self-service withdrawal to the immediate product of the discount savings accounts and current account.

3- The issuance of Visa cards.

4- Borrowing services.

4- National Commercial Bank:

The establishment of the national commercial bank’s contribution to the Libyan established on the basis of Act No.153 of 1970 to nationalize the foreign shares in the banks and re-organization and to identify the contributions of the Libyans. The purpose of the bank is doing all the work for the bank to commercial banks in Libya and abroad.

Services provided by the bank

1-Accept demand deposits or for opening of current account and contract and term loans of various credit facilities and other grants.

2- Collection and payment of orders and bills of exchange and other valuable papers.

3- Instruments and the issuance of bonds and treasury bills and other commercial papers, whether payable in Libya or abroad, except to pay bills negotiable bearer on demand.

4- Discount and rediscount and the circulation of commercial papers of any kind, which is paid in Libya or aboard.

5- Issuance of letters of guarantee and opening documentary credits, either in Libya or abroad.

6- The business of the bank to the provisions of foreign exchange controls.

7- The issuance of bonds in the financial limits set in law and in the system.

8- Buying and selling securities and owns and authorizations issued or guaranteed by the government or public institutions and bodies or as issued or guaranteed foreign governments or international financial institutions and all the limits and conditions prescribed by the law.

9- Buy and sell stock and have to contribute to the institution in Libya, or outside the limits and conditions prescribed by the law.

10- To organize and direct public offerings, all acts relating o securities.

11- Representation of various bank facilities at home and aboard.

12- Keeping of securities and other securities and things of value as a amaanah in bank vaults and safes, and rental of special funds.

13- Provide all the usual banking facilities and other processes directly involved in banking business in general. And to the bank in order to achieve its purpose to be involved in any way with other enterprises engaged in similar work or work to aid in the achievement of that purpose inside or outside Libya, or to be merged, bought or involved to it.

5- Sahara Bank:-

Sahara bank is one of the largest banks in Libya created in 1964 and organized as the second largest public bank in Libya; Sahara bank became the first financial institution in Libya in 2007 that entered into the strategic partnership. With a network of 48 branches covering all the main regions in the county, Sahara bank is one of the leading banks in Libya that has developed a large portfolio in both corporate and retail banking.

As Libyan Banks with an international profile, Sahara bank is integrated as a member of BNP Paribas Group and will benefit from its worldwide network, dedicated trade centers (90) and expertise in innovative products.

Sahara bank is committed to meet its customer expectations through a modern set up of three core business lines:

Institutional banking offering a close relationship to state unity, development funds, banks and insurance companies.

Corporate banking through specialized organizations and dedicated services.

Retail banking with new product offer and more sales oriented branches layouts.

Sahara bank through BNP Paribas as strategic partner will bring to the Libyan market a new vision of the banking activity to better serve local and international clients.

Services provided by the bank:

Current Account

Savings Account

Loans

Money Transfer

Swift Services

Other products and Services

Islamic Banking

Source: Website Sahara Bank

2-5- The Private Banks

1-The Mediterranean Bank

The average bank was founded in 1997 under the name Benghazi National Bank, and began to submit work to the public on 24/03/1997. The commencement of its work through one section there is a capital city of Benghazi 900000 Libyan dinars of a fully-paid, which represents three-tenths of its capital subscribed only three million dinars, according to a contract founded and the rules of procedure and should be mentioned here that the bank has the distribution of profits to shareholders, since the first budget, which was dated 31/12/1998.

Leading to the issuance of law No.1 of the year 2005 and to meet the requirements of the terms of this law change the name to the bank and raise the average of the authorized capital to 33333000 Libyan dinars to contribute to the door which has been opened in the capital of the bank and was a good turnout of citizens, with the size of the head money in the amount of 31/12/2005 D.L 3000000. 31/12/2006 in the amount of 8381386 D.L 31/12/2007 in the amount of 12058976 D.L, which confirms the terms of the bank of good standing in the Libyan market with the end of 2006, specifically the 03/12/2006 which has four branches.

Services provided by the bank:

1-Accept demand deposits and for the opening current accounts.

2- The granting of loans to different deadlines, and other credit facilities.

3- Discount and rediscount of commercial papers and circulation.

4- Provide payment instruments, and other orders and bills of exchange, drawn from the clients or them, and collected.

5- Services for documentary credits, and making the collection of documents, letters of guarantee.

6- Issuance and management of payment instruments, including the cash, and financial transfers, payment cards and credit, and instruments of tourism, and others.

7- Handling money market instruments, with the tools of the capital market, sale and purchase, whether for or on behalf of this clients.

8- Purchase and sale of debt, whether with or without recourse.

9- Financial leases.

10- Dealing in foreign currency exchange markets, present and future.

11- Management of securities issues, and the commitment to coverage, distribution and handling.

12- The provision of advisory services and other portfolio, and the investment services, including fund management and investment to the detriment of others.

13- Management and conservation of the secretary of securities and valuables.

14- Secretary to provide services or financial advisor.

15- Real estate ownership, sale and lease.

16- Any other business related to banking activity, approves the Central Bank of Libyan to practice.

2- The United Bank for Trade and Investment

United bank for trade and investment was established for trade and investment (such as particular) by a decision the Central Bank of Libya No. 58 for 1375 and. R. (2007)P, which is the outcome of the merger of three banks are:

Sahal Al-jafara National Bank.

Five points National Bank.

Al-Ajeelat National Bank.

The capital of united bank authorized 33.3 million Libyan dinars, subscribed is paid in full, while the amount of the rights of shareholders (740000KD) at the end of fiscal year 2008. On the other hand, the consolidated budget (assets and liabilities) amounted to total of (186000000) Libyan dinars.

Services provided by the bank:

Current account

Savings accounts

Time deposits

Certificates of deposit

The letters of guarantee

Direct financial transfer

SWIFT services

Documentary credits

Credit

The Self withdrawal

Lease sale

The sale of borrowing

Development of investment management

Source: Website United Bank for Trade and Investment

3- Bank of the Arab Consensus

Arab unanimity bank’s contribution to the Libyan bank was founded based on a decision to the secretary-General people’s committee of finance No.50 of the year 2003, the department opening the bank to Act on 03/08/2003, and it process a building attached to it by the main branch of Benghazi has been to provide the elements section of young trained and, after almost a year of foundation activity, the bank expanded by opening branches so Tripoli and Missrata in order to be able to provide services to the largest segment of customers.

Services provided by the bank:

Current deposits and time

Exchange of foreign currency

Personal safes

Linking the appropriations

Letters of guarantee

Credit facilities

Source: Website Bank of the Arab Consensus

4- Trade and Development Bank

Services provided by the bank:

Bank account

Credit and banking operations

Bank electronic

Mobile bank

Payment cards

ATM locations

Point of sales (POS)

Instruments tourism

Personal safes

Car banking service

Agency of children

Banking services by touching the screen

Source: Website Trade and Development Bank

5- AL-Aman Bank

6- Al-Sarai Bank

7- Arab Commercial Bank

8- Al-Wafa Bank

The saving and real estate investment bank

Development bank

Rural bank

The agricultural bank

National institution bank

National commercial bank

The Sahara bank

The unity bank

The republic bank

Al-Wafa bank

Arab commercial bank

Al-Aman bank

Al-Sarai bank

Trade and development bank

The Mediterranean bank

Bank of the Arab consensus

The united bank for trade and investment

The Libyan foreign bank

The state owned banks and it’s the commercial bank

The private banks

Central Bank of Libya

The state owned banks and specialized which aimed at social development

2.2- Previous studies

The literature review contains two sections. The first part reviews studies which Addressed measuring service quality and customer satisfaction in the banks, and second part address the awareness customers to the service quality provided by these banks:-

2.2.1- measuring service quality and customer satisfaction:-

A Study (D. Wafa Nasser Almberek 2002) entitled (Quality banking services women’s in Saudi Arabia) this research aims to know the opinions and directions of women towards women’s quality of banking services in Saudi Arabia, using a scale SERVQUAL his dimensions five and aims to measure the overall quality of this service. and the five dimensions are tangibility, assurance, reliability, responsiveness and empathy.

Have reached results to the positive impression of the overall quality of the banking service of women in Saudi Arabia.

Study (Naceur Jabnoun and Hussein A.Hussein Al-Tamimi 2003) entitled ( Measuring perceived service quality at UAE commercial banks) this paper develops a modified SERVQUAL for measuring service quality in the United Arab Emirates commercial banks. The instrument includes thirty items that belong to the five dimensions of SERVQUAL. The developed instrument was tested for reliability and validity and the results indicated that the instrument had only three dimensions. also in this paper investigates the difference in significance between the instrument’s dimensions. This is supposed to help mangers focus their attention on the service quality dimensions that matters most to customers.

Findings investigated the difference in significance between the dimensions of this instrument the human skill dimensions was found to be more significant than the dimensions of tangibles and empathy.

Study (D.Rushde Abdul Latif Wade and D.Yousuf Hussein Ashour 2005) entitled (Assessment banking service quality in the Gaza from point of view customers) the aim of this research is to measure banking service quality in Gaza Strip from point of view customers. The research investigates the existence of service quality gaps through applying the SERVQUAL model. to achieve the goal of the study the Researchers used a form developed by the gap theory by (Parasuraman and other,1985). and the independent variables for this study are tangibility, assurance, reliability, responsiveness and empathy.

The results suggest that there is a gap between expectation and performance.

Study (D. Salah Abdul Rahman Mustafa Talab 2005) entitled (Measuring the quality of Islamic banking services in the Queen of Jordan Analytical study field) the objective of this research is to know the views and orientations of customers of Islamic banks operating in Jordan using five variables reflect the dimensions of the services from the view point of customers, used in measuring the quality of Islamic banking in Jordan.

The results indicated that reached by the search to the positive impression about the quality of Islamic banking services in the area of concrete and physical aspects of response and compassion. In the area of reliability and security were not enough to satisfy the sample customer research, which indicates that Islamic banks have an obligation to work to improve these aspects in the area of service delivery.

Study (Fares Mahmud Abu Mummar 2005) under title (Measuring the quality of banking service in the banks operating in the Gaza Strip) the aim of the study is to measure the service quality of the banking system in Gaza Strip and to determine the important of the service quality items. In addition the study measures the relationship between banking service quality and client’s satisfaction.

The study concludes that understanding the client’s expectations is very important to provide better banking service quality as well as achieving client’s satisfaction. Furthermore the measurement of service quality and the client’s perception of the service are considering the main approach for the development and improvement of the banking service quality. Findings also showed a significant relationship between the client’s satisfaction and the provided service quality.

Study ( Noel Yee-man Siu and Jeremy Ch-wah Mouv 2005) under title ( Measuring service quality in internet banking: The case of Hong Kong) this study adapts the dimensions of the SERVQUAL (Zeithaml et. 2000, 2002) and attempts to examine customers’ service quality perceptions in internet banking, as well as the impact of these perception and customer satisfaction and future consumption intentions. Hong Kong, a regional trading and services hub in Asia, is adopted as a case study. Four analytical dimensions are identified: credibility, efficiency, problem handling and security.

Findings indicate that all dimensions except security are found to be important in determining overall service quality perceptions. Credibility, problem handing and security have significant impact on customer satisfaction. Moreover, security and efficiency are significantly associated with future consumption behavior.

Study (J. Clement Sudhahar; D. Israel and M Selvam 2006) entitled (Service quality measurement in Indian retail banking sector: CA approach) the present study on service quality SERVQUAL holds the SERVQUAL primarily determines the customer value which in turn contributes to the customer retention and loyalty, realizing the paramount role of SERVQUAL in service marketing more specifically in a customer intensive industry like retail banking Allred(2000)has developed a comprehensive scale to measure service quality in banking sector in this empirical study applying the scale developed by Allred a perceptual map on a set of retail banks in India is drawn through a sophisticated multivariate non-parametric called correspondence analysis.

the important results of the study are service quality attribute image survey of selected public and private sector banks reveal that much need to be done for public sector banks in improving thier performance by revamping the service marketing strategies. while the public sector bank SBI is closely related to security, reliability and credibility, still it needs to improve on aspects such as tangibility, fairness, and treatment and more importantly on accessibility and courteous behaviour of employees towards the customers

Study (Lotfollah Najjar and Ram R.Bishu 2006) entitled (Service quality: A case study of a bank) .The objective of this research was to identify underlying dimensions of service quality in the banking industries and to assess the importance of each of these dimensions in the banking industries. the independent variables in this study are tangibility, assurance, reliability, responsiveness and empathy.

The results show that reliability and responsiveness are the two most critical dimensions of service quality and they are directly related to overall service quality. Responsiveness and reliability have been shown to be important factors supporting previous work by Berry, Zeithamly and Pasrasuraman (1985). Also as was shown before the response rate of customers from bank B is higher than bank A.

Study (Niki Glaveli, Eugenia Petridou, Chris Liassides and Charalambos Spathis 2006) Entitled (Bank service quality: evidence from five Balkan Countries) this paper aims to examine the differences: in perceptions of service quality and in the ranking of quality dimension between the bank customers of five Balkan countries: Albania, Greece, Bulgaria, Fyrom and Serbia. Bahia and Nantel proposed a specific scale for measuring perceived service quality in retail banking consisting of six dimensions of service quality effectiveness and assurance; access price; tangibles; service portfolio; and reliability. This tool was used for collecting data in the context of banking services from the five Balkan countries T-Test and factor analysis were employed to answer the research questions.

The findings suggest that Greek customers perceived receiving the highest level. In addition price, effectiveness (besides Greece) and reliability appear to be the most important factors in the creation of perceptions of the service quality received in the five Balkan countries and access the least important.

Study (Nuri Calik and N. Figen Balta 2006) under title (Consumer satisfaction and loyalty derived from the perceived quality of individual banking service: A field study in Eskisehir from Turkey) This research intends to find out the differences in the quality of the services rendered by the national banks of Turkey as perceived by the bank customers. The results obtained from this field research did not produce too much surprise or disillusionment to the authors of this paper since the time lag between the collection and analysis of the data coincided with an economic crisis that ruled Turkey for more than two years, during this crisis period almost all of the small-sized banks (13 out of 14) were either liquidated or turned into a fund (savings deposits insurance fund) governed by the banking regulation.

Study ( Okan Veli Safakli 2006) under title (Testing SERVQUAL dimensions on the commercial bank sector of Northern Cyprus). Despite the philosophy of the SERVQUAL model developed by Parasuraman, Zeithaml and Berry is universally accepted and applied for measuring service quality in different sectors including banking, the sustainability of SERVQUAL dimensions started to be questioned. Research has shown that cultural difference across countries may have the potential of generating different quality dimensions pertinent to the country and culture where the service is offered. In this respect this study is conducted to examine the sustainability of SERVQUAL dimensions towards the service quality of commercial banks in Northern Cyprus. As expected, factor analysis as the principal method of the research has necessitated the revision of SERVQUAL dimensions so as to reflect unique customer preferences in Northern Cyprus.

Findings respondents reported negative results for all dimensions, meaning that expectations are greater than performance and perceived quality is less than satisfactory and a service quality gap materializes. This shows that all types of commercial banks, regarding which client quality perceptions did not differ significantly, should improve their service quality in order to overlap with clients’ expectations. Furthermore, it should be noted that apart from the age group and marital status other demographic characteristics yielded no significant differences in disparity of service quality.

Study (Ugur Yavas 2006) entitled (How similar are frontline bank employees’ perceptions of service quality to their customers? A study of female customer and employees in Turkey) this study aims to investigate to what extent underlying configurations of customer. Evaluations of service quality as perceived by frontline employees and as reported by customer. The SERVQUAL instrument is used in measuring employees ’ and customers ’ perceptions of service quality. Findings show that the underlying configurations of service quality perceptions decompose into three factors in the cases of both customer groups and five factors in the case of employees. Overall, customers’ and employees’ service quality perceptions do not correspond. This discrepancy underscores the need for accurate assessment of customer perceptions of service quality and training of employees to look at service quality from the perspective of customer.

Study (Wayne Kwan and Tan Jing Hee 2006) entitled (Measuring service quality in Singapore Retail banking: A gap analysis &segmentation approach) this study aims to demonstrate the use of gap and segmentation analyses in measuring service quality and also to show how mangers could use the results of the analyses to enhance their banks’ service quality. in order to achieve this goals the researchers used a variables, independent variables are tangibility, assurance, reliability, responsiveness, empathy and demographic variables such as(Occupation, Origin ethnic, Age, Marital status, Education, Income and Gender).

Findings this paper demonstrated the usefulness and relevance of using basic analytical techniques to measure service quality. The gap analysis segmentation analysis and multiple regression analysis provide excellent information for building a customer-focused attitude towards service delivery.

study (Izah Mohd Tahir and Nor Mazlina Abu Bakar 2007) entitled (service quality Gap and customer’ satisfaction of commercial Banks in Malaysia) The aim of this study is to investigate the level of service quality of commercial banks in Malaysia from the perspective of bank customers and assessing the satisfactions towards the services provided by the commercial banks, and the variables for this study are Tangibility, Reliability, Responsiveness, Assurance, Empathy, satisfaction level, demographic variables.

The findings of the study indicated that the overall service quality provided by the commercial banks was below customers’ expectations. Responsiveness was rated the most important dimension followed by reliability, tangibility, assurance and empathy. Futher the findings also found that customers were slightly satisfied with the overall; service quality of the banks.

Study (Ugur Yavas and Martin Benkenstein 2007) entitled (Service quality assessment a comparison of Turkish and German bank customers) the purpose of this paper was first to determine the underlying configurations of service quality perceptions between Turkish and German bank customers and the to ascertain the extent of cross cultural congruence. to achieve the goal of the study the researchers used a comparative approach. The variables of this study consisted of dependent variable is service quality assessment, the independent variables are culture, tangibility, reliability, responsiveness, assurance, empathy.

Findings indicate that the underlying configurations of service quality items decompose into an equal number of factors for both groups, further analysis of the data indicates that the extent of congruence between the two groups is strong. On the conceptual side these results lend credence.

Study (Vu Thi My Chin and Nguyen Viet Anh 2008) under title (Measuring customer satisfaction based on service quality at a local bank in Vietnam), the researchers’ aims to testing. Is there a gap between customer perception and customer expectation towards the service quality which the bank is offering? also, is there an association between gender/age of customer and the frequency of their bank visits.

the results in this study found that first, the perception - expectation gaps of different widths existed across all five service quality dimensions. second,The width of the gap varied depending on each particular aspect of these five service quality dimensions. It is true that on bank can be the best for all customers. thrid, the study proved that there was an association between service quality gender and frequency level of respondents while there was no association between age and the frequency of their bank visits.

Study (Riadh Ladhari 2008) under title (Assessment of the psychometric properties of SERVQUAL in the Canadian banking industry) this study aims to investigates the psychometric properties of the well-known SERVQUAL model in the Canadian banking industry. The study utilizes the performance component of SERVQUAL in an empirical survey conducted among 193 Canadian bank customers.

The results show that responsiveness and empathy are the most important dimensions of overall service quality in the Canadian banking context. the results show that the service provided by employees makes the largest contribution to bank customer satisfaction In view of the study’s findings, Canadian bank managers must recognize that frontline employees are crucially important in establishing and maintaining a competitive position for their institution. Also SERVQUAL is a suitable instrument for assessing bank service in the Canadian context bank managers can, therefore, confidently use this instrument to undertake continuous evaluation of their service quality.

Study (Arshad,D A. and Adnan, K A ) entitled (Customer satisfaction towards Islamic banking in Malaysia: A study using CARTER model), This study aims to determine potential differences in customers’ satisfaction towards Islamic banking (between geographical areas) in Malaysia. An alternative service quality measurement model called CARTER developed by Othrnan and Owen (2001) has been used particularly to address elements of compliance to Shari’ah in addition to Parasuraman’s service quality measurement of five original dimensions. Data collection covering 5 largest cities from 5 states and four regions of peninsular Malaysia has been sucessfully conducted in which 1036 questionnaires have been returned. Respondents were randomly chosen from two of the largest banks in Malaysia in which one is Islamic bank and the latter is conventional bank offering Islamic banking scheme products and services. Descriptive statistics has been used to determine customers’ perception on elements of service quality while Analysis of Variance (ANOVA) has been applied to determine possible differences in customer satisfaction on Islamic banking between geographical areas (5 cities).

findings of the study Anova analysis show that there are significant differences in customer satisfaction towards Islamic banking between geographical areas (cities). then, post-hoc analysis also shows that the significant differences lies between Johor Bahru and two other cities of Alor Star and Kuala Lumpur. Differences in customer satisfaction between Alor Star and Johor Bahru were probably not difficult to explain due to the fact that the two cities are significantly different in terms of population and development growth (the latter is bigger, highly populous and is more economically developed). Nonetheless, differences between Johor Bahru and Kuala Lumpur are more complicated to explain due to similarities between the two cities in terms of economic development and population. Extensive study on relationships between the cities in terms of cultural issues, the banking environment and demographic factors such as Gender, Income and Level of education could be the missing point in this issue. in conjunction, it is critical for the banks to rectify the situation (differences in customer satisfaction between geographical areas) as it potentially affecting customers' loyalty as well as their own image and reputation. Hence, differences in customer satisfaction between cities. In the mean time, this study can also be improved through the inclusion of more banks, respondents and predictors (independent variables). The participation of only two banks has limited potential respondents from other Islamic and conventional banks. Coverage on more geographical area or city could also be considered for future study in order to enhance the generalizability of the findings and to further invest