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Contented customers establish some connection to a particular merit or advantage of a product or service. For a variety of reasons, contented customers do not extend their use of a product or service beyond some circumscribed boundaries they themselves establish. In a marketing framework, committed customers are said to have accomplished product or service differentiation, believing that their needs and preferences are best met by their selection. Loyal committed customers are likely to provide recommendations to others to the extent that they may be considered to be brand ambassadors.
Other scholars have taken the line of thinking that customer loyalty is best understood by disaggregating the variables that function as determinants of consumer loyalty. These determinants of customer loyalty are generally grouped as company-related, customer-related, and relationship-related factors (Cahill, 2007, p. 15). Company related influences include intangibles such as a company's reputation or the price to quality ratio, or tangibles that provide distinct advantages to customers, such as loyalty programs (Cahill, 2007). Customer-related variables are basically attributes and propensities of the consumers. and, relationship-related determinants are primarily derived from the interactions between the consumers and the purveyors (Cahill, 2007). Duffy (2003) distinguishes internal and external customer loyalty determinants. According to Duffy (2003), internal factors can be thought of as the individual perspectives of the customers toward specific brands, products, or services. In marketing vernacular, these positive internal factors would be referred to as customer brand attitude. The external determinants refer to capabilities of the brand managers, marketers, and advertisers who work to cultivate and sustain customer loyalty (Duffy, 2003, 480).
The traditional role of the bank has changed dramatically over the last several decades and this role change has impacted how consumers initially select banks as well as their long-term loyalty and decision to change banks, either as primary service providers or when looking for additional services. "Banks have traditionally played the key role in the financial system by acting as financial intermediaries between ultimate savers and borrowers. As asset transformers, they have accepted deposits with one set of characteristics and created assets with a different set; in particular, they have engaged in maturity transformation with debt contracts on both sides of the balance sheet. They have also been the central mechanism within the payments system" (Llewellyn, 2009). In fact, this line of thinking was evident as early as 1980 when Fama (1980) argued that, absent banks playing a role of numeraire in a monetary system, banks would be self-regulating and there would be no need to control either deposit creation or security purchasing activities. Because banks acted largely as intermediaries between savers and borrowers and held a substantial percentage of wealth that belonged to those who are not wealthy, they were considered a protected class of institution, so that steps were taken to ensure that they could not fail.
However, in the time period leading up to the recession that followed the fiscal crisis of 2008, there was a significant shift in the nature of banking business; banks began to engage in an increasing level of financial services, which shifted them out of their traditional role as intermediary an into more speculative businesses (Llewellyn, 1999). A climate conducive to simplifying and improving regulations dominated the late 1990s, as the Labour governments began a general program that took a "one in, one out" approach to regulations. By 1997, banks and other financial institutions had been officially deregulated. The Bank of England was freed from direct government control, and in turn, the Bank of England no longer governed the financial activities of UK banks. The Legislative and Regulatory Reform Act of 2006 established new statutory principles, and the code of practices permitted ministers to introduce Regulatory Reform Orders to address laws on the books that were no longer considered relevant. The Financial Services Authority (FSA) was abolished and replaced with the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA). The PRA will be part of the Bank of England and will have oversight of financial services firms. The Bank of England will utilize its Financial Policy Committee (FPC) for direct supervision of the entire banking system, including the two new regulating agencies. This change is the largest since the Bank[continue]
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