This project report is concerned with innovation and its effects on business performance in SwaziBank. The study, explanatory in nature, purposely looked into how product innovations, process innovations and market innovations affect the business performance of SwaziBank. This study sought to find out why there is variability in performance despite adopting these innovations. The study adopted an explanatory research design in which a population comprising forty eight senior managers of SwaziBank was taken using the census method. Data was collected mainly by the use of research questionnaires and face-to-face interviews, and secondary data was obtained from the 2010 SwaziBank Annual Report, which included audited financial statements for five years between 2006 and 2010.

 Data collected was analyzed through the use of descriptive statistics and the Pearson’s product-moment correlation coefficient and also multiple regression. The study found that 50.8 percent (R2 = 0.508) of the variance in business performance of SwaziBank may be explained by the predictor variables namely; product innovations, process innovations, and market innovations while random factors account for 49.2 percent of the variations in the criterion variable (business performance). In addition, regression results indicated that the three factors do not have equal explanatory power of the dependent variable. Product innovations influences most of the variance in business performance (is the most important) according to the unstandardized beta coefficients (β = 0.922, ρ = 0.018) which was statistically significant at 5 percent level. The study also yielded useful and conclusive information in the service innovations that SwaziBank undertook and in particular it managed to establish that the innovations had led to better performance of the bank in terms of improved profits and customer and stakeholder and stockholder satisfaction. From the financial results of SwaziBank, it is clear that the bank had not adequately reaped the benefits of innovations because there has been variability in business performance despite these innovations. The study further came up with recommendations for SwaziBank pertaining to its service innovations and the need in particular to involve staff more in its quest to innovate since they are the ones who interact with the customers. The study also concludes with a suggestion for further future research in the service innovation field in order to establish other useful findings that this particular study may have been unable to determine.