The competitive power of a bank is largely defined by the degree of its conformance to customer needs. Thus, customer satisfaction and loyalty are critically important factors to achieve long-term business prosperity in banking. In turn, customer satisfaction depends on provided service quality and its perception by customers. The goal of the research is to take the opinions of Latvian citizens about the service quality in Latvian banks. Besides, the aim was to compare bank customers’ and employees’ perceptions of service quality and to evaluate the gap. To achieve these goals, the authors used their own developed questionnaires. To evaluate bank service quality, SERVPERF and weighted SERVPERF models were applied. Data processing was conducting with SPSS and AQUAD programs. The scientific contribution of the authors is development and approbation of the qualitative instrument for measuring service quality that can be used by bank managers to make right marketing decisions.