Agent-based simulation of the influence of customers’ behaviour on the bank’s failure

In Lithuania like in other states there are different capital credit institutions and banks (from 10 to 20) operating in the country. Even in small towns with the population of nearly 20 000, there are up to five operating banks and credit unions. Nowadays, the success of commercial banks depends upon their image and the opinion of the interested groups of the society about the quality of provided bank services. Being rather high competition among banks, there are cases when there appears rumours about poor economic situation in one or another bank. The key of such canard might be caused by negligence at work, for example, untimely loaded ATMs. The bank has a possibility to observe the amount of money in the ATM; therefore, it can’t be empty in normality. However, there are cases, when due to the staff negligence or other reasons, commissions aren’t carried out in time, also, crediting official registration takes too long, sometimes, lack of money in the branch of the bank to pay off the money after the term of the deposit expires. Rumour spreads really fast. Disbelieving in canard is the state’s rather significant policy in respect of the bank. In Lithuania like in other states there are different capital credit institutions and banks (from 10 to 20) operating in the country. Even in small towns with the population of nearly 20 000, there are up to five operating banks and credit unions. Nowadays, the success of commercial banks depends upon their image and the opinion of the interested groups of the society about the quality of provided bank services. Being rather high competition among banks, there are cases when there appears rumours about poor economic situation in one or another bank. The key of such canard might be caused by negligence at work, for example, untimely loaded ATMs. The bank has a possibility to observe the amount of money in the ATM; therefore, it can’t be empty in normality. However, there are cases, when due to the staff negligence or other reasons, commissions aren’t carried out in time, also, crediting official registration takes too long, sometimes, lack of money in the branch of the bank to pay off the money after the term of the deposit expires. Rumour spreads really fast. Disbelieving in canard is the state’s rather significant policy in respect of the bank. Unfortunately, people take canard easier. However, in the cases, when it’s impossible to get their money back whenever a person wants, it might cause panic and, in spite of the fact, that the bank operates normally, serious problems can appear. The aim of the research and the article was to investigate influence of canard on banks customers’ behaviour and effects of various bank decisions regarding of giving back to depositors their money. The research methodology was agent-based modelling of impacts of canard/rumour spreading and bank's decisions. Simulation and its results showed that the possibility for bank customers to get back their money suppresses rumours, but limitations intensify the panic. Authors suppose that the significance of the model and its results' lies in demonstration of possibility of agent-based models to investigate the banks and its customers' behaviour without real-life experiments. The agent-based modelling can be used in university in consumer behaviour courses as well.