Why it’s always cool to hate banks

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This article is part of Gallup’s current series on the changing landscape of financial institutions. It provides insights into channel optimization, emerging customer behaviors and preferences, product penetration and relationship growth, engaging the most critical affluent and business customers, and reshaping the overall value proposition of customers. banks.

Americans’ confidence in banks as an institution rebounds, but always low – to say it generously. Though there is lots of things banks can do – and are doing – in restoring the confidence of their own customers, it seems evident that banks as a whole are not making significant strides in restoring the confidence of the general public. This begs the question – almost seven years after the onset of the financial crisis, why is it still cool to hate banks? I have a few theories:

Small businesses are “good” and large businesses are “bad”.

Over the past few years, it seems politicians have changed the definition of what is deeply American as “motherhood, apple pie, and small business owners.” And the public responded to it. According to the same study that shows the public’s lack of confidence in banks, we know that 67% of Americans have a fair amount or a lot of confidence in small businesses. Compare that with just 21% of Americans who have the same level of trust in “big business”. Banks are often described as the epitome of big business and all of its pitfalls – especially highly paid executives who seek profit at all costs.

But that in itself lets the banks go too easily. Historically, banks have been able to achieve many greater customer confidence. And although we know that customers of small banks and credit unions are more committed with their bank than with the customers of the “big banks”, the chasm is narrowing and many big banks are progressing year by year. For those who aren’t making progress with their retail clients, it’s not because they can’t, it’s because they choose not to. The leaders of these institutions can focus on the higher aspects of their business when it is the daily experience of engaging retail banking customers who are likely to have the greatest impact on restoring public confidence.

Good bankers are not sexy media.

Name this TV show where a banker helped a customer get a car loan even though the customer had a bad credit score (through no fault of their own – another lender messed up their credit report and it was taking years to fix). Or, how about that movie where the banker got a small business owner client into a line of credit with a lower interest rate than their current loan, and in the process told the client how better manage his cash flow so that he now feels more successful? Perhaps it was that touching video on YouTube where the banker solved a direct deposit issue for a military spouse whose husband was deployed overseas and on the verge of running out of necessary cash thousands of miles away though. it was not resolved that day. You remember? Of course not, because local banker wellness stories won’t make a studio executive money or garner viral status on the internet. Nobody pays $ 12 for a ticket or subscribes to Netflix to watch a movie about someone who did the right thing the first time. But these are just some real-life examples of how customers have told us that their bank – even some of the “big banks” – has provided them with extraordinary trust-building experiences.

We are bombarded with images and portraits of bankers, but these representations are likely to be somewhat of a mystery to the average person and to exist in the world of institutional, private, or investment banking. Think about the wolf of Wall Street, Boiler room, where Law and order episode where the investment bank was with the crowd and responsible for several murders. Or consider the endless media stories on Wall Street and executive salaries and bonuses, The daily show segments – this is what stays in our heads. The truth is, there are a lot of great people out there who work in banking. They understand that money affects every aspect of their clients’ lives and they work diligently to provide fair solutions for both their clients and their employers. And because of this, most people can separate what they think of their bank from what they think of the banking industry as a whole. “Love my banker, hate banks” is likely to be the ubiquitous general attitude for some time. Or, at least until the economy recovers enough that people forget that it was the banks that caused it in the first place, until those sexy ‘bad bankers’ stories that we are in. constantly submitted can be seen as stories.

It doesn’t feel like the people in charge paid the price.

Yes, the reckless behavior of the banking sector has had consequences. I’m sure there are bank executives who would say there have been more than enough consequences including mergers, small bank failures, job and monetary losses, capital erosion. branding and increased regulation that many executives believe is stifling their take-over. But just one person the general public has never heard of from a company that most people have no experience with went to jail. We haven’t seen any high-profile lawsuits, no 25-year jail sentences, no insanely heavy fines, no Bernie Madoff-style promises. Lehman was bought by Barclay’s, Merrill Lynch lives at Bank of America just as Wachovia was taken over by Wells Fargo.

To the public, this all seems very normal for the banks. But the average American still knows the neighbor who has lost his job and is financially unstable after a long period of unemployment, continues to walk past foreclosed or unfinished homes, has to keep paying off his original HomeBanc mortgage, if he doesn’t. still worried about the value of her home. own house because it’s right now this closure to no longer be underwater. The average American still talks to his brother who lost his job and was lucky enough to find a new one quickly – but is making 30% less money than before, so his wife took a part-time job in retail to help catch up. the difference. The consequences are real for us, we feel that we have more than paid the price, but it is very difficult for the general public to understand how the bankers paid their dues.

I’m sure there are those who would be completely satisfied with some form of punishment for the purposes of pure revenge, but I think the deepest underlying problem is that as a society we never have could put an end to this crisis as we did in the past. Bernie Ebbers brought down a Fortune 500 company and will spend 25 years in prison for his hard work on this front, along with his brothers Enron and Tyco. Anderson was shut down by the government (although the Supreme Court later overturned the decision – who remembers?). If you remember the news cycle in the early years, we couldn’t get enough of these stories, so they came to their natural conclusion and we just kept going. We cannot trust something that we cannot trust, and we cannot trust something that seems to take no responsibility for its actions. Bank stories don’t come out as fast and furiously as they were in 2008 and 2009, but every time a new story comes out we are reminded that we never had a shutdown and the crisis is still on. In progress. . The larger issue always seems systemic rather than specific to the bank, and it still feels like an unfinished business.

Until the banking industry decides that it can – or even wants to – correct its public perception through better public relations, better government relations, or ideally both, individual banks will have to bear the brunt. The only way for these banks to improve their status is to continue doing what works: improving a customer’s perceptions, one time that saves financial lives, one personal financial dream at a time.

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About Nereida Nystrom

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