Dissertation: Factors Behind Hong Kong Bank Branch Decline

This dissertation investigates the decline in the number of bank branches in Hong Kong. It begins by outlining the research aim, objectives, and questions, emphasizing the importance of understanding the changing landscape of the banking sector. The study explores the literature, analyzing banking and e-banking services, assessing customer behavior's impact, and identifying factors influencing banking services. The research methodology includes research philosophies, approaches, and design, along with data analysis and collection methods. The analysis delves into e-banking services, customer behavior, and the components affecting banking services, leading to conclusions and recommendations for optimizing services and upgrading bank branches. The study highlights the significance of the banking sector, the rise of e-banking, and the shift in consumer behavior, offering valuable insights into the evolving financial landscape of Hong Kong.

Number of bank
Branches decrease in
Hong Kong

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Research Aim.........................................................................................................................4
Research Objectives...............................................................................................................4
Research Questions................................................................................................................4
Rationale for the research study.............................................................................................4
Purpose of the study...............................................................................................................5
Problem statement..................................................................................................................5
Dissertation structure..............................................................................................................6
CHAPTER 2- LITERATURE REVIEW.........................................................................................8
Introduction............................................................................................................................8
Analyse the banking services and e-banking services in the Hong Kong.............................8
Assessment of the impact of customer behaviours on the banking branches on Hong Kong10
Analysis of the components that impact on the banking services........................................11
Strategies to optimise the banking services in order to upgrade the bank branches............13
CHAPTER 3 RESEARCH METHODOLOGY............................................................................16
Introduction..........................................................................................................................16
Research Philosophies..........................................................................................................16
Research approach................................................................................................................17
Research Design...................................................................................................................18
Research Techniques............................................................................................................19
Data analysis.........................................................................................................................19
Data collection......................................................................................................................20
Research Limitation..............................................................................................................20
Ethical consideration............................................................................................................21
CHAPTER 4 DATA ANALYSIS AND INTERPRETATION.....................................................24
Introduction..........................................................................................................................24
Analysis the e-banking services and banking services in the Hong Kong...........................24
Analysis of the customer behaviour on the services of banking in the Hong Kong.............26
CHAPTER 5 CONCLUSION AND RECOMMENDATION......................................................33
REFERENCES..............................................................................................................................35
Appendix........................................................................................................................................40
INTRODUCTION...........................................................................................................................3
Research Aim.........................................................................................................................4
Research Objectives...............................................................................................................4
Research Questions................................................................................................................4
Rationale for the research study.............................................................................................4
Purpose of the study...............................................................................................................5
Problem statement..................................................................................................................5
Dissertation structure..............................................................................................................5
CHAPTER 2- LITERATURE REVIEW.........................................................................................1
Introduction............................................................................................................................1
Analyse the banking services and e-banking services...........................................................1
Assessment of the impact of customer behaviours on the banking services..........................2
Analysis of the components that impact on the banking services..........................................3

Strategies to optimise the banking services in order to upgrade the bank branches .............5
Examine the existing condition of Hong Kong banking sector..............................................6
CHAPTER 3 RESEARCH METHODOLOGY.............................................................................7
Introduction...........................................................................................................................7
Research Philosophies............................................................................................................8
Research approach..................................................................................................................9
Research Design...................................................................................................................10
Research Techniques............................................................................................................10
Data analysis.........................................................................................................................11
Data collection......................................................................................................................11
Research Limitation..............................................................................................................12
Ethical consideration............................................................................................................13
CHAPTER 4 DATA ANALYSIS AND INTERPRETATION.....................................................15
Introduction..........................................................................................................................15
Analysis the e-banking services and banking services in the Hong Kong...........................15
Analysis of the customer behaviour on the services of banking in the Hong Kong............17
CHAPTER 5 CONCLUSION AND RECOMMENDATION......................................................24

INTRODUCTION
In the present time, every individual is directly and indirectly connected with the banking
sector. In present time, All every individualsindividual have requirement to manage their excess
capital and hence theytheir financial security and transaction transact with banks in this context.
By managing excess fund of citizens, banking sector certainly aids in mobilising saving which in
turn leads to Banking sector helps to the country in improvement in ing economic condition.
Additionally, banking sector aids in transferring saving into investment which results into growth
of the country. With help of banking sector every country can improve its sustainable
development and growth. Thus, it can be said that banking sector can help in improving its the
economic condition within the country because by various in different ways like such as
employment generation, infrastructure development, rise in agriculture production, business
loan, house loan and other related that certainly leads to improvement in the standard of living. ,
education banking sector helps in large manner. In these all sector, bank provides helps in
financial manner like loan, insurance etc through which these sectors has been improved in the
country. Thus, it can be said that banking sector helps in the country by sustainable development
and growth in large manner. Hence, every country havehas huge great importance of the banking
sector as it aids by which it can in gaining improveimprovement its in various aspects like
education, agriculture, employment, investment etc. Furthermore, people is able to get financial
advices and accordingly they can manage their also take the finance in safe manner and make
financial transaction in effective manner. Also, banking services supports individual People can
in savinge their money and makeand can make transaction attransaction at any time and at
anywhere.
Hong Kong is special administrative region of the people's republic of China. Hong Kong
maintains a separate political and economic system from cChina. It also maintains its
independent executive, legislative and judiciary power. Hong Kong is one of the most significant
world financial centres of world which have the highest financial development index score. In
the bBanking sector of Hong Kong, it has one of the highest concentration of banking institution
in the world. It has more than 100 banks which that operate their banking offers facilities and
services in an effective manner for the within Hong Kong public and other part of the world. Till
As per the research it has been founded that in the December 2016, within the Hong Kong, has
156 are licensed bank and 22 are restricted licensed bank. In addition to this, it has 17 deposit

taking companies and 57 representative offices of the foreign banks. In the Hong Kong, the
banking system is characterised by its 3 tier3-tier system which have formed with three banking
institution that are licensed bank, restricted bank and deposit taking companies. In addition to
this, banking sector in the Hong Kong have significant role in order to fund raising in the region.
It also influences the prominence in the region and also Hong Kong bank have set up operation
in other parts like Asia, typically the Chinese mainland. In the present dissertation, the major
topic focus is to investigate the rationale behind declining in the for the numbers of bank
branches declining in the within Hong Kong. In the present time, numbers of the bank branches
hashave been declines due to the several reasons in the region. Thus, the major objective of the
researcher is to investigate the numbers of bank declined in the Hong Kong. In order to address
this aimTo conduct this study, scholar has ve developed various different objectives like assess
the customer behaviour and its impact on banking sector, to examine factor that influence the
banking service in branches etc. In addition to this, for attain this objective, scholar have focused
on the various method of research methodologies such as research approach, research
philosophies, research design, data collection, data analysis, sampling etc. for addressing the
mentioned research aim.
Research Aim
To investigate the rationale behind for the numbers of declining in the number of bank branches
declining in the Hong Kong.
Research Objectives
 To review the literature in relation to the banking service and e-banking service within
Hong Kong
 To examine factors that impact the banking service in branches in the Hong Kong
 To assess the impact of customer consumer behaviour on the impact on banking services
operation in the branch of at Hong Kong.
 To draw conclusions and make recommendations to optimize banking service in order to
upgrade the bank branches’ service.
Research Questions
 What is the banking services and e-banking services in the Hong Kong?
 Analyse the influence of customer behaviour on the banking services in the Hong Kong?

 What are different Examine the components factor that influence becoming the banking
services reasons in the behind decline in bank branch of in Hong Kong country?
 How Recommendation to optimize banking services can be optimized in order to so that
number of bank branches can be increased in Hong Kong? upgrade the bank branches in
the Hong Kong
Rationale for the research study
In the present dissertation the major objective of scholar is to investigate the rationale
behind for the declining in numbers of bank branches declining in the Hong Kong. This is very
significant topic by which scholar can easily assess the entire condition of banking sector in the
Hong Kong country. Main reason behind investigating this topic is to identify the influence of
different components on the banking sector at Hong Kong. Moreover, decline in bank branches
can be either due to high operating cost which the company cannot afford or might be due to
decline in sales. Hence, this study has highlighted the key reasons behind the mentioned issue
and possible solution to rectify the problem is given. Also, one of the reasons behind decline in
the number of bank branches can be shift in consumer behaviour of going more digital than that
of practicing physical banking transaction. All of these factors are taken into account and present
study is conducted with a motive to highlight the reasons behind decline in the number of bank
branched in Honk Kong.
The major reason for selecting this topic in this dissertation is that researcher wanted to
acknowledge about the various components which influence the banking services in the branches
within Hong Kong. In addition to this, in this dissertation significance of banking services and e-
banking services will also include because scholar have huge interest in the e-banking services so
as researcher will select this topic as the research topic. Another major reason for selection of
this topic is that researcher have sufficient data and information about this subject.
Research Framework
In order to conduct this study, several research methods are taken into account.
Researcher has focused on applying positivist philosophy and deductive approach in order to
assess the reasons of decline in number of bank branches. Further, descriptive research design is
applied with a motive to describe the scenario in depth. It is essential to collect the data so that
information related to actual scenario can be attained. In this respect, secondary source of data
collection is taken into account with a motive to identify the reasons behind decline in bank

branches in Hong Kong. Data is obtained by reviewing books, journals, news articles, business
magazines and published data. For the purpose of assessing the data, qualitative and quantitative
measures is utilized. Themes are developed and discussion is done upon it that aids in gaining
results from it.
In this study, researcher will firstly select an appropriate topic of the study. On the basis
of the top, aims and objective can frame by the scholar. In addition to this, literature review can
design in order to collect secondary information. In addition to this after designed literature
review in the next stage, researcher will focus on the research methodology. With assistance of
the research methodologies, researcher can address the actual issue of the study. In addition to
this, with help of primary data collection, researcher can found out appropriate solution. On the
basis of data collection, researcher can design the conclusion and recommendation.
Source of data
In this present study, researcher can use secondary data. In the literature review,
researcher has collected data from secondary sources such as books, journals, online articles,
blogs etc. On the other hand in the data analysis and interpretation, researcher have also used
secondary data. in the present dissertation, scholar has been used secondary data collection under
which information about the banking services and existing situation of banking sector in the
Hong Kong can collect by the secondary resources such as books, journals, articles, online
websites, magazines, news papers etc. In this secondary data collection, various view and
opinion of the authors has been included about the topic.
Purpose of the study
In the entire this dissertation, the major main aim of the researcher is to investigate the
rationale behind decline in the number of for the numbers of bank branches declining in the
Hong Kong. In this respect, statistics related to business is considered which aids in identifying
the reasons behind the shutting of bank branches. For attainment of this objective, scholar will
focus on the statistics of the banking sector. Through this study, scenario within banking sector
can be assessed that aids in framing appropriate strategy. Further, this study has focused on
popularity of e-banking facilities among individuals which will aids in streamlining the process
of banking. Additionally, other factors that influencing the banking sector of Hong Kong is also
highlighted in this study.

In addition to this, study have major important is that with help of this study, scholar can easily
analyse and assess the banking sector condition in the Hong Kong. This study help to the scholar
in investigating the importance of the e-banking services for the country as well as individuals.
In addition to this with help of this study, scholar can also investigate the factors that influence
on the banking sector in the Hong Kong. Thus, it can be said that researcher can able to assess
the various components which affect the banking sector as well as customer behaviours impact
on the banking services.
Problem statement
Banking sector is one of the key industry of any country which plays a significant role in
the economy as well. Beside this, there are certain another factor which makes banking a crucial
factor. It aids in mobilising saving, boosting investment trends, generates employment, supports
in infrastructure development, support small business, provides loans, aids in boosting standards
of living, support agriculture and certain other. Presently, it is evident that are significant close of
bank branches in Hong Kong which is a key research problem. Due to this scenario, there will be
direct impact on social and economic aspects of Hong Kong. Hence, performance of banking
sector is also reviewed in this study in order to identify its impact on other activities.
very wide topic as it have includes various components that affect its working criteria in the
countries. The major aim of this topic is to investigate the rationale for the numbers of bank
branches declining in the Hong Kong. Thus, it is very difficult to assess the performance of
banking sector within the country because most of the bank does not disclose their information in
publicly. There are various factors which affect the performance of banking so this is very big
issue for scholar to asses the knowledge about the each factor.
Dissertation structure
Present study is been arranged with following heads in order to give clear information to
readers: In order to produce the complete dissertation, there is consisted various chapters which
are as follows-
 Chapter 1- Introduction- This is first chapter in the dissertation which define aims and
objective of the entire dissertationstudy. It aids in setting the context of study and also
highlighted the reasons behind conducting the study on selected topic. Through this,
interest among reader is created. In the absence of the introduction chapter, researcher

can not able to develop an effective dissertation. The significance, rationale and outline
of the structure can include in this first chapter.
 Chapter 2- Literature review- It is required to review the past literature and information
so that gaps from it can be identified and same can be bridged with present study. With
this motive, literature review section is developed which gives background and
theoretical information to the reader. Once the introduction chapter has developed then
researcher can focus on the literature review chapter under which various themes of the
topic can include. With assistance of this chapter, researcher can get the detail knowledge
and understanding about the subject.
 Chapter 3- Research methodology - This is another very significant chapter in the
dissertation which includes various method of the research methodology such as research
approach, research design, research philosophies, data collection, data analysis , sampling
etc. With help of this chapter, scholar can find out an appropriate solution of the research
problem by assist of various methods and techniques of the research methodology.
 Chapter 4- Data analysis and findings- This is the key section of whole thesis as it
deals with the findings. In this, data are considered and discussion upon same is done in
order to obtain finding from it. This section aids in gaining results based on which
conclusion is framed. Once the research methodology chapter has completed by the
scholar then researcher focus on the data analysis and finding under which researcher
collect and analyse the information about the subject. Only with help of this chapter,
conclusion about the subject can obtain because in this scholar can interpret the collected
information.
 Chapter 5- Conclusion and Recommendations- This is the last chapter in the
dissertation which help in framing conclusion de and summarise the entire discussion. In
this chapter, scholar finally conclude and summarise the entire discussion. In this chapter,
recommendation can alsois also include about the subject.

CHAPTER 2- LITERATURE REVIEW
Introduction
In the entire dissertation literature review chapter plays a very crucial role by which
scholar can easily focus on the various aspects of subject matter. With help of this literature
review chapter, scholar can get the detail knowledge and understanding about the subject and
collect secondary data. In the literature review, various information can collect about the topic
from the use of various articles, journal, magazines, newspaper etc (Samad, 2016). With help of
these resources, scholar can collect the secondary data about the subject. Various authors views,
suggestion, thoughts helps to the scholar in understanding about the subject. In the present
literature review, scholar has developed various themes about the subject of banking sector in the
Hong Kong. The major objective of this dissertation is to investigate the number of branches of
bank decline in the Hong Kong so researcher has developed various themes about the subject.
These themes provide detail understanding about the subject through which scholar can conclude
the data. In the present dissertation, with help of literature review, scholar can easily obtain the
secondary information about the subject and find out the best solution for the research issue.
Following are various themes about the number of branches of banking declines in the Hong
Kong-
Analyse the banking services and e-banking services in the Hong Kong
According to the view of van Esterik-Plasmeijer and et.al., (2017) in the country, banking
sector plays a very crucial role by which financial and economic condition of the country can
easily measure. With help of banking sector, country can improve its economic and sustainable
condition within the country. In the present time, the e-banking services is continuously
increased due to enhancing the technological development. In the present time, every individual
is too engaged so they have no time to go to bank for financial transaction. With help of E-
banking services they can make their financial transaction easy and fastest. In the E-banking
services includes various services such as online banking, ATM and debit card services, phone
banking, fund transfer services, point of sales banking etc. Each of this e-banking services have
direct relationship with the banking services because in order to operate the E-banking services,
bank have to conduct the secure connection with banks. E-banking product and services offered
in two tier structure. A basic tier of internet banking structure includes customer account inquiry,
fund transfer and electronic bill payment. According to the view Ho and Lin, (2010) Hong Kong

is one of the most world financial centres which have the highest financial development index
score. In the banking sector of Hong Kong, it has one of the highest concentration of banking
institution in the world. It has more than 100 banks which operate their banking facilities and
services in an effective manner for the Hong Kong public. As per the research it has been
founded that in the December 2016, within the Hong Kong, 156 are licensed bank and 22 are
restricted licensed bank. In addition to this it has 17 deposit taking companies and 57
representative offices of the foreign banks. In the Hong Kong, the banking system is
characterised by its 3 tier system which have formed with three banking institution that are
licensed bank, restricted bank and deposit taking companies. In the 2016 in the Hong Kong,
banks continuously operates under the low interests rate. As per the government statistic, in the
end of December 2020 in the Hong Kong there were 45 deposits taking companies, 46 restricted
banks and 133 licensed banks. With help of bank in the Hong Kong there is effective support of
finance given to the china development projects. While in the country there has Asian financial
crises left then many banking system has been influenced in large manner. Due to the sadden
massive outflow of the money from the Asian region, there fragile structure has been highly
influenced. In the Hong Kong, the top 10 incorporated banks also recorded increases in their
cost to income ratios which is the average of 42.3% and it also increases of 0.9 percentage point
compared to 2014.In the context of cost in the banking sector of Hong Kong, top 10 bank
branches disclosed the most improved cost to income ratio of 44.5% in the 2015.On the other
hand in the context of standard charted bank increased the cost to income by 3.5% which bring
the entire ration of the banking services by 55.6% in the 2015. According to the view of Zarrabi,
Nazari and Akbari, (2014) credit quality of banking sector, in the Hong Kong credit quality of
the loan will exposed to china's economy. It has been also founded in the survey of Hong Kong
banking branches that in the top 10 incorporated bank the average impaired loan ration has been
increased by the 0.70% in the 2015.

In the opinion of van Esterik-Plasmeijer and et.al., (2017) banking services are those
services which provide the financial facilities to the public. This services deliver effective
facilities to the customer so as they can make their financial transaction and safe their money in
the bank. With help of banking services, people can also take the interest rate from their capital
amount. In the opinion of Esterik-Plasmeijer and et.al., (2017) There are various kinds of
banking services such as checking account, saving account, debit and credit cards, insurance,
wealth management etc. These all services helps to the customer in securing their money in the
bank and customer can easily get the interest rate over their fund. With help of banking services,
customer can also take the loan for their personal and business use. According to the view of
Morrison, (2015) banking services have direct relationship with e-banking services in order to
deliver the banking facilities with help of electronic form, bank have to make some changes and
take the help from the bank. As per the objective of this dissertation, researcher have main
objective is to find out the numbers of branches which de clinging in the Hong Kong. Thus, in
this objective, e-banking can help to the country in improving its banking branches. With help of
e-banking, country can improve its banking sector in an effective manner as it can deliver
banking facilities with help of the electronic medium such as ATM, phone banking, mobile
banking, SMS banking, fund transfer services. According to the view of Morrison, (2015) In the
Hong Kong Due to these reason, many banks in these countries have taken excessive loans to
risky projects such as property, stock and unsecured personal loans. There has drastic fall occurs
in the prices of property and shares due to Asian financial crisis took place within the countries.
In the view of Pérez and Del Bosque, (2012)In addition to this, borrowers has also unable to
repay their debts and various bank was facing the crushing financial difficulties. In the Hong
Kong, bank escaped disaster because the industry is effectively regulated and the bank is
effectively sound in the context of finance. According to the view of Zarrabi, Nazari and
Akbari, (2014) In these bank they are not allowed to hold more than 40% of their assets in
property related assets. Thus, it can be said that bank in Hong Kong is financial sound as they are
delivered effective financial services and facilities to the customer and satisfied their needs
related to the financial aspects. They had a difficult time at the time of Asian financial crisis and
thereafter. The drastic fall in the demand for the loan has led to great fall in their profitability.
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