Internationalization of retail banks: A micro-level study of the multinationality-performance relationship

Abstract and Key Results

•	This study discusses the underlying reasons for the variant nature of the relationship between multinationality and firm performance in the context of service firms.
•	To date, this line of research has mostly used evidence from manufacturing firms, despite the ever-increasing contribution of service firms to national and global economies.
•	We conduct an exploratory study using case analyses of large European retail banks. We argue that the nature of the multinationality-performance relationship for services is moderated by industry characteristics, market-based factors and firm-specific factors.
•	We conclude that the shape of the curve depicting the multinationality-performance relationship of retail banks experiences substantial variations on a single case level.
•	Our exploratory study of retail banks shows that the multinationality-performance relationship varies significantly depending on banks’ strategic decisions regarding branch network configurations, product portfolios, branding strategies, organizational architecture (HQ-subsidiary relationship), and social networks. Any generalization of the relationship is difficult and prone to error.