M.Comm. / Rationalization processes are part and parcel of the environment within which we all function. ABSA Bank Limited is one of the companies that had to be rationalized. The banking sector is a very competitive sector. The only way for a company to be distinguishable from other similar companies, is to excel in quality service performance. The overall goal of this study was to determine to what extent, Gap 3: The performance gap, exists in the International Banking Services of ABSA Bank Limited and also to formulate recommendations on how to decrease the size of Gap 3. Gap 3 forms part of the service quality model, which consists of five gaps, designed by Parasuraman, Berry and Zeithaml (Zeithaml et al, 1990:46). The first of these gaps, Gap 1, constitutes the difference between the client's expectations and the management's perception of the client's expectations. The second gap, Gap 2, is representative of the difference between the management's perception of the client's expectations and the expected service quality specifications. The third gap, Gap 3, concerns itself with the difference between the specifications for the service and the actual service delivered. The fourth gap, Gap 4, represents the difference between the actual service delivered and the promise of the service which was communicated to the client. The fifth gap, Gap 5, called the service quality gap, defines the difference between the client's expectations and the client's perceptions of service quality. Gap 5 is the result of all the aforementioned gaps. The study was based on a questionnaire designed by Parasuraman, Berry and Zeithaml (Zeithaml et al, 1990:196 - 197, 201-205). In conclusion, the studies showed that the actual size of Gap 3 is smaller than expected for a company which has recently been rationalized. The main factor contributing to the existence of Gap 3, is the evaluation and remuneration processes. The second factor, is the employees' need to be empowered to take more decisions on their own. The last main contributor to the size of Gap 3, is role conflict: due to the rationalization process, the employees are not sure of what is expected of them. Recommendations were made to decrease the size of Gap 3 even further, in order for ABSA Bank Limited to be more successful in the banking sector.