THE EFFECT OF COMPETITIVE ENVIRONMENT AND INFORMATION TECHNOLOGY INFRASTRUCTURE ON BANK’S PERFORMANCE IN MALAYSIA

Abstract

The performance of the bank is very crucial as it provides input and output of the economy. If the performance profitability of bank is sound and in a resilient condition and that will definitely attract more people to make a deal with banks. The performance of banks can influence all the sectors through the monetary circulation. Banking has been a prolific industry for innovation concerning information systems and technologies. In the epoch of globalization, the competitive business environment of the banking institutions is expected to escalate dramatically. Similarly, the banking institutions in Malaysia have experienced noticeable changes in its business environment as a consequence of financial liberalization and consolidation, economic transformation, and more discerning consumers. The study will provide the empirical evidence of the following output: new findings and knowledge that benefited the researchers and managers at banks that emphasize the strategic importance of information technology infrastructure and competitive environment in the performance within the Malaysian banking institutions. The results of the analyses show that information technology infrastructure has a significant effect towards performance, while competitive environment showed an insignificant relationship of information technology infrastructure with the performance. Thus, appropriate strategies are important to enhance their performance and ensure their survival, especially in these turbulent economic times.