It has long been recognized that it costs five to eight times more to acquire a new customer than to retain a current one and that existing customers are an avenue to bringing in new customers and a potential base for “cross-selling”. Thus, customer retention is critical for a service organization’s survival and success. Better employee service performance is associated with higher customer satisfaction and increased customer loyalty, both of which determine customer retention. Therefore, it pays for an organization to emphasize high-quality service performance and enhance service performance among employees. The study provides support for most of the linkages in the model. The results of this study have substantial implications for the banking industry.