Competitive Pricing And Performance Of Financial Institutions

TABLE OF CONTENTS

Content Page

DECLARATION ................................................................................................................................... ii

APPROVAL .......................................................................................................................................... iii

ACKNOWLEDGEMENT ................................................................................................................... iv

DEFINITION OF KEY TERMS ......................................................................................................... v

TABLE OF CONTENTS .................................................................................................................... vi

ABSTRACT ........................................................................................................................................... x

CHAPTER ONE ................................................................................................................................... 1

INTRODUCTION ................................................................................................................................. 1

1. 0 Background ......................................................................................................................... 1

1.1 Current state of Uganda's banking sector ................................................................... 1

1.2 Mission and objectives of Centenary Bank ...................................................................... 4

1.3 Governance of the bank. ...................................................................................................... 4

1.4 Staffing ...................................................................................................................................... 5

1.5 Statement of the problem ..................................................................................................... 5

1.6 General objective of the study ............................................................................................. 5

1. 7 Specific objective ..................................................................................................................... 5

1.8 Research questions ................................................................................................................ 6

1.9 Scope of the study .................................................................................................................. 6

1.10 Significance of the study .................................................................................................... 6

Negative factors .................................................................................................................................. 7

CHAPTER TWO .................................................................................................................................. 8

LITERATIJRE REVIEW ..................................................................................................................... 8

2.0 Introduction ......................................................................................................................... 8

2.1 Definition of price ................................................................................................................... 8

2.3 Financial institutions .......................................................................................................... 12

2.4 Efficiency of institutions .............................................................................. , ...................... 13

2.5 Relationship between performance and competitiveness .......................................... 13

CHAPTER THREE ........................................................................................................................... 15

vi

METHODOLOGY .............................................................................................................................. 15

3.0 Introduction ....................................................................................................................... 15

3. 1 Design of the study .............................................................................................................. 15

3.2 Study population .................................................................................................................. 15

3.3 Data collection ....................................................................................................................... 15

3.4 Method of Data Collection .................................................................................................. 16

3.5 Questionnaires ...................................................................................................................... 16

3.6 Interviews ............................................................................................................................... 16

3.7 Observations .......................................................................................................................... 17

3.8 Data Processing and Analysis ........................................................................................... 17

3.9. Limitations of the study ..................................................................................................... 17

CHAPTER FOUR .............................................................................................................................. 18

PRESENTATION AND DISCUSSION OF FINDINGS ................................................................ 18

4.0 Introduction ........................................................................................................................... 18

4.1 Demography ........................................................................................................................... 19

4.2 Understanding of the term piice ....................................................................................... 19

4.3 Influence of competitive pricing ........................................................................................ 20

4.4 A graph showing the percentage in influence of competitive pricing ...................... 20

4.5 Graph showing the percentage of sources of funds to financiru institutions ........ 22

4.6 Relationship between competition and performance .................................................. 22

4.7 A chart showing the relationship between competition and performar1ce ............. 23

4.8 Competitors of Centenary Bank ....................................................................................... 24

4. 9 Graph showing the competitors of Centenary Bank ................................................... 24

4.10 Pricing techniques used by Centenary Bank .............................................................. 25

4.11 Challenges facing Centenary Bank. ............................................................................... 25

4.12 Graph showing challenges faced by Centenary Bank. .............................................. 26

Source; Global Trust Bank ............................................................................................................ 27

CHAPTER FIVE ................................................................................................................................ 27

RECOMMENDATION AND CONCLUSION ................................................................................. 27

5.0 Recommendation .................................................................................................................. 27

5.1 Conclusion ............................................................................................................................. 28

5.2 Areas for further study ........................................................................................................ 29

vii

Questionnaire ............................................................................................................................... 29

References ...................................................................................................................................... 33

viii

ATM

GDP

EADB

BOU

UDB

ABBREVIATION:

Automatic Teller Machine

Gross Domestic Product

East African Development Bank

Bank of Uganda

Uganda Development Bank

ABSTRACT

Research under the topic "Competitive pricing and performance of Financial

Institutions" was carried out in two branches of Centenary Bank.

The objective of the study

• To identify the pricing techniques used by Centenary Bank

• To investigate the influence of competitive pricing on the banking sector

• To find out competitors that has dominant edge in the financial sector of Uganda.

Means of competitive pricing

When a company sets its prices chiefly on the basis of what its competitors are charging, its pricing policy can be described as competition oriented. It is not necessary to charge the same as competitors, although this is a major example of this policy. The competitors oriented pricing firm may seek to keep its prices lower or higher than competitors by a certain percentage.

Methods used in the collection of data

Questionnaires; Self-administered questionnaires that are both open and closed ended questionnaires are used. Interviews; Formal and informal interviews are used. That is, the interviews will have formulated questions written down and others come in the due course of the interview process. Observation; under this, the researcher simply observes what the respondents are doing. She uses non-participant observation method. This is where she simply observes minus participating in what the respondent is doing