Customers of Irish banks are among the least satisfied in Europe, results from the European Customer Satisfaction Index have shown.

The Irish retail banking sector saw overall satisfaction drop two percentage points this year, from 71 to 69 per cent. Bank of Ireland's satisfaction rating was 67 per cent, with AIB scoring just above that, at 68 per cent.

Only banks with a domestic market share of greater than 10 per cent were named in the study.

The results place Irish retail banks at the lower end of the sector, along with Portugal and Spain.

More than 1,000 people were surveyed here for the index by the MRBI in October and November. Excellence Ireland is responsible for the index in the Republic.

Based on a standardised methodology developed by the Stockholm School of Economics, it measures feedback on image, customer expectations, perceived quality of product or service and perceived value - including perception about the relationship between price and quality.

Mr Sean Conlon, chief executive of Excellence Ireland, said the Irish banking sector needed to re-examine ways in which it could continue to deliver more value to customers.

"This year's drop in satisfaction is significant, as banks should be even more conscious of looking after their customers' needs as the euro is introduced," he said.

The European index was developed by a partnership between the European Organisation for Quality, the European Foundation for Quality Management and the European Society for Opinion in Marketing Research.

Each national index is managed by one main organisation in each country. In total, 12 European countries have to date participated in the index.

In the US, where the American Customer Satisfaction Index is calculated, it has become a key economic indicator and measure of company performance, Excellence Ireland claims.

This year, three industry sectors were surveyed in the Republic - retail banking, mobile telecommunications and supermarkets. The results of the other sectors will be published shortly.