I sincerely do not believe that there is a single fixed formula for deciding on choosing a bank. Every bank is different in their functioning, in their approach toward customers and their risk perception. The choice of bank, though difficult should depend mainly on the product (loan, savings account, deposits, locker facility etc.) one plans to deal with a particular bank. However, I have listed down a list of prerequisites for choosing a bank:
Proximity: The choice of a bank should depend on the proximity to the residence or office. Preference to be given to proximity to residence than office, since office premises can change.
Location: It is very important to have a bank situated near a busy place with maybe police station in the vicinity. This is important specially if one transacts in huge sums of cash transactions and/or having lockers. The least one can ensure that the bank is not situated in a notorious area.
Basic strength of the Bank: The past performance and the history of the bank is a very important decision, while choosing a bank. If one has to open Fixed deposits and/or have savings bank, one has to ensure that the Bank is stable, so that the bank can oblige to its commitments. Everyone is aware of what happened to the many shady banks sprung across India especially in Gujarat. Also note one has to be aware of the happenings in the banking sector especially the news which affects your bank directly or indirectly. Be conscious to the news of any fraudulent transaction, mismanagement or concerning slipping financial performances.
Bank?s access to funds: Ensure that the bank has enough strength to cough up the funds when needed either by way of equity funding or debt. The better the bank the easier access and the cheaper sources to raise funds and vice versa. This is specially affects if one needs to obtain a loan from the bank.
Infrastructure: In this ?e? generation a bank needs to provide good infrastructure facilities to attract good customers. Ensure that the bank has ATM machines sprung across the city, and ATM machines should be working efficiently and effectively. Also one should be able transact through Phone banking, Mobile Banking and Internet Banking.
Charges: Whilst the interest rates moves more on the demand/supply curve and competition, the charges which quite nicely disguised needs to be taken care of. Specially the new generation banks adhere these kind of tricks by loading the hidden costs to stay in competition and still make good amount of money. Please get these kind of things cleared before choosing a bank: One can demand for a tariff sheet before signing the documentation.
Management and Bureaucratic policies/ procedures: Ensure that the banks policies and procedures are not very bureaucratic. Generally there is a myth that all nationalized and co-operative banks are bureaucratic as compared to Foreign Banks and Private Sector Banks. This is wrong. Some of the better managed co-operative banks and the nationalized banks are more efficient and more transparent than the new generation banks.
Since I work in a Bank, I can tell you that Service Industry (in general) is a thankless industry. It is very difficult to satisfy all the clients and their unique requirements. Nevertheless if one takes the above necessary steps (hmmmm.....may not be exhaustive), you be assured that your money is in the right hands coupled with good efficient service.
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Cheers
Vijay