Banking Strategies for Competitive Advantage
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Questions and Answers

What is one way the bank can establish a distinct identity in the face of fierce competition?

  • Hiring unqualified staff
  • Investing in real estate properties
  • Reducing customer services
  • Improving advertising efforts (correct)
  • Why is it important for banks to show the relevance and utility of their services to customers?

  • To confuse the customers
  • To discourage customers from using banking services
  • To attract and retain customers (correct)
  • To benefit from direct contact with customers
  • What is a key challenge faced by banks due to the variety and diversity of banking services?

  • Meeting diverse needs efficiently (correct)
  • Decreasing the number of services offered
  • Avoiding innovation in services
  • Limiting customer options
  • Why is predicting future demand for banking services challenging according to the text?

    <p>Because demand fluctuates due to economic conditions</p> Signup and view all the answers

    What should banks consider when balancing growth and expansion in banking services?

    <p>Considering risks that could arise</p> Signup and view all the answers

    In the context of fierce competition, why is it essential for banks to innovate new products?

    <p>To attract more customers and stand out</p> Signup and view all the answers

    What is the role of the Council of Ministers in regards to bank establishment licenses?

    <p>Issuing licenses based on recommendations of the Minister of Finance</p> Signup and view all the answers

    What is one of the basic principles of effective competition in a stable financial system?

    <p>Promoting innovation and efficiency</p> Signup and view all the answers

    How are banking services defined in the text?

    <p>Activities provided by banks to satisfy customer needs</p> Signup and view all the answers

    What is a characteristic of banking services according to the text?

    <p>Services can be intangible and not result in ownership transfer</p> Signup and view all the answers

    In the context of banking services, what does 'lack of unique identity' mean?

    <p>Banks have identical service offerings</p> Signup and view all the answers

    What role does SAMA play in the issuance of bank establishment licenses?

    <p>Reviewing applications before licenses are granted</p> Signup and view all the answers

    Which of the following is a restriction placed on banks by Article (10) of the Banking Control Law?

    <p>Owning stocks exceeding 20% of the bank’s paid-up capital</p> Signup and view all the answers

    What type of activities are banks prohibited from engaging in according to Article (10) of the Banking Control Law?

    <p>Wholesale or retail trade</p> Signup and view all the answers

    Which of the following financial actions is forbidden for banks in relation to their own shares?

    <p>Issuing guarantees based on their shares</p> Signup and view all the answers

    In accordance with the Banking Control Law, which action is not permitted for banks regarding their Board members or Auditors?

    <p>Granting loans without security</p> Signup and view all the answers

    What is the maximum percentage of a joint-stock company's paid-up capital that a bank can own shares of, according to the Banking Control Law?

    <p>20%</p> Signup and view all the answers

    Which financial activity is not allowed for banks with respect to their employees, as stated in Article (9) of the Banking Control Law?

    <p>Granting loans exceeding four-month salary</p> Signup and view all the answers

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