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The Banking Game: Literature Review Part Three and Conclusion by Doreen Soutar

The Banking Game: Analysis of the extinction of the bank as trusted institution and NONIIs as an indicator of non-reciprocal strategies by Doreen Soutar. This is the third part of her literature review and conclusion to her investigation…

Retail Banking: a Co-Operative Model

The savings and loans banking division operates in a social environment which is built on repeated encounters, engendering the growth of mutual trust and cooperation (Motashemi & Mui, 2003). Here, customers are given to believe that the bank is essentially working for the augmented good of the group, where community wellbeing is the main focus rather than the wealth of the bank, as is implied in the statement by the CEO in Barclays’ annual statement (Diamond, 2010). This is not restricted to the equality of reciprocity of a single lender and the bank, but also applies to altruism “fed forward” in an emergent, and customers benefit at different times in differing amounts.

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The Banking Game: Analysis of the Extinction of the Bank as Trusted Institution by Doreen Soutar

The Banking Game: Analysis of the extinction of the bank as trusted institution and NONIIs as an indicator of non-reciprocal strategies by Doreen Soutar

Abstract

The crisis in the financial markets in 2007 has drawn much attention to the way banks operate, and in particular the interaction between the trading and retail divisions. Here an evolutionary model is used as a basis to examine bank behaviour towards their customers, suggesting that banks are utilising competitive strategies in an essentially cooperative environment. The example of non-interest bearing profit-making activities is used to demonstrate this strategy, and it is suggested that current bank size and attitude towards customers threatens to render large banks with extinction.
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