Survey says, the bigger the bank, the less people trust them
Filed under: Banks
It's no revelation that big banks have an image problem these days. And to add proof to what we'd already suspected, a new report from Forrester Research shows that America's biggest banks are the least trusted banks in the country.Forrester Research ranked almost 50 financial services firms in the United States, asking approximately 4,500 people if they agree with the following statement: "My financial provider does what's best for me, not just its own bottom line."
With the percentage of respondents who agreed with that statement ranging between 33% and 16%, the bottom seven of this year's rankings were, in order, Bank of America, Chase, Capital One, TD/Commerce, Fifth Third, Citibank and, at the very, very bottom, HSBC.
But this isn't just due to the bailouts. As American Banking News points out, these banks have been at the bottom of the survey for the past seven years.
Just out of curiosity, I contacted a well-regarded corporate image consultant who specializes in branding to see if he had any suggestions for how the banks could regain their customers' trust.
I expected some optimism, but just as a measure of how deep a hole the big banks now find themselves in, Adam Hanft, CEO of the branding firm Hanft Projects, wasn't able to give me much.
Just to give you a little background, Hanft is the co-author of The Dictionary of the Future: The Words, Terms and Trends That Define the Way We'll Live, Work and Talk. He's the type of guy who not only blogs for the Huffington Post but has also appeared on The Daily Show with Jon Stewart. So he's tapped into the whole pop culture arena.
Unfortunately, if you're a banker hoping for a scrap of good news from Hanft, there isn't much to find.
It's not that he thinks banks can't regain their customers' trust. He just hasn't seen them doing anything lately that's going to bring it back. "Part of the reason that banks aren't trusted," says Hanft, "is that their behavior has been so inconsistent. I think the banks have spent too much money on PR people trying to spin their behavior rather than working on making changes in their infrastructure.
"We're long past the point where just clever messaging can save the banks' reputations," Hanft adds, "They can say, 'We recognize that they're our problems, and we're going to have to improve, we're looking out for you,' but -- well, you know, all that crap frankly doesn't mean anything."
If the banks are going to regain anyone's trust, says Hanft, they have to start making real changes in how they do business, like being more transparent. Hanft says that Ally Bank, which used to be GMAC, is one of the few banks that appears to be doing a good job with that.
"Trust has to be earned through authentic and integrated responses that are simple and concrete," says Hanft, "and frankly, I haven't seen any real meaningful effort to win trust back."
But that may our fault, says Hanft. "The passivity of the customer has been pretty remarkable," he says. "There's been populist outrage but no pitchforks. If you look at what people have done, they haven't pulled their money out of Bank of America. I see people angry, but their behavior doesn't reflect that. They're sheep and haven't punished the banks in any way."
If we would start getting angry enough to take our money out of our accounts and switch to a smaller bank, says Hanft, maybe the banks would have a reason to start treating people differently. There is, in fact, a movement touting just that. Arianna Huffington's small money movement is slowly gaining traction.
"Even during the most heightened emotional outbursts, when people were mad over the bonuses being given to Wall Street, the people haven't reacted," Hanft says. "I wonder if with the Internet, we're given the ability to vent and rant, and that releases everyone's energy, and then people keep doing what they're doing anyway. It seems like a curious psychological phenomenon."
Have you done anything concrete to show your bank just how mad you are? If you've put your money where your mouth is, let me hear about it.
Geoff Williams is a frequent contributor to WalletPop, often writing about banking issues. He is also the co-author of the new book Living Well with Bad Credit.
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Reader Comments (Page 1 of 2)
2-14-2010 @ 3:13PM
Robin said...
Yes, I did. But it happened years before the big melt down. We relocated every year which meant changing banks. At first I went for the big banks for convenience. The first time one of those big banks treated me like I didn't count I closed all of our accounts and headed over to a local bank. Been doing that ever since.
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2-16-2010 @ 10:34PM
Jeff said...
I'm not surprised to see Bank of America on the list. Last week I canceled my credit card with them when one customer service rep. dared me to find a better deal and the other told me everyone at BofA was treated alike. I took the dare of the first person and found a MUCH better card, and as for the second --- "Bank of America, if you think a person who's had a BofA card since 1995, three BoA accounts and a house mortgage (and who has an excellent credit rating) should be treated exactly like a person who is consistently overdrawn, consistently maxed out on their card and missing payments ... then I hope more and more people pull out." Personally, I think I should be rewarded for being a good customer ... not have my card shut down for being 1 week late on a payment ... something I'd never done before; hence I didn't know that's what would happen. And, they wouldn't reinstate it. It won't happen again. I cut the card up. The accounts and mortgage are next.
2-15-2010 @ 12:47PM
Eric said...
Robin, I did the same thing. After moving to Florida I decided to start banking at Bank of America. It became pretty clear after awhile that Bank of America wasn't just charging a few extra fees here and there, they were actively farming my accounts for every penny they could. I left too.
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2-15-2010 @ 2:32PM
Sabrina said...
I am not surprised to see HSBC is rated the lowest
they are the worst company to deal with ever
real-wishes dot com where wishes become reality
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2-15-2010 @ 4:04PM
Wendell said...
Chase Bank USA, N.A. is also lowering their image. I applied for a "SONY" card as advertised on The Wheel Of Fortune. I have excellent credit, pay all bills on time, never carry a balance on credit cards and have NO debts. CHASE replied "we are unable to approve your request. Our reason is that the anticipated account related expenses (are) likely to exceed (the)expected revenue". I guess they want only "poor risks".
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2-16-2010 @ 2:04AM
Diane said...
Democrats passed the Credit Card Act of 2009 which will go into effect on February 22nd. This bill will prevent banks from arbitrarily raising your credit card rates. Republicans tried to block it. That's how much Republicans care about Middle Class Americans.
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2-16-2010 @ 10:28AM
Diane said...
And, by the way, attempt to freeze credit card rates and fees until more strict regulations take effect in February died in the Senate when Republicans blocked an attempt to speed the bill through.
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2-16-2010 @ 2:22PM
James said...
The Big Banks not only have to serve there big borrowing customers. They have to serve the big bank giant task master with the huge package contract. That is why the business is being drained and has become unfriendly with more hidden fees as the stars in the sky. What a mess they have created at our expense.
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2-16-2010 @ 3:23PM
Michichael said...
Yup. I pulled my money out of Bank of America after they backdated my rent debit to 2 days before it was ever submitted, causing 5 overdrafts and over $200 in fees. They refused to admit fault and I pulled all of my money from them and went with a local credit union. I pulled my car loan from them and went with the local credit union even though they were $40 more a month.
The only account I still have with them is my AMEX, and that's only because I have them in a binding contract for a permanent 7.9% fixed rate APR that they can't change. They tried doing the whole "We're going to up your rates if you use the card" bit so I just didn't use the card - nobody did. They I got a call saying "Well we backed off of that so you can use your card."
That's proof that the customer did something - everyone either closed their accounts or opted out, so they had 0 business, or at least enough reduction in business that they had to go back to the lower profit margin business, because low profits are better than no profits. They don't make money if you don't use your card and pay it off early.
I'm still carrying a 10k+ balance on that card, but it's my only credit card, and I haven't found one that can beat the 7.9% fixed rate to transfer to. if I could find a card that would take that transfer and still give me a 7.9% or lower APR I'd do it - BoA doesn't care about anyone but themselves.
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2-16-2010 @ 4:30PM
Denise said...
We've switched our automatic payroll deposits from Fifth Third to Teachers Credit Union. Last month, my poor image of Fifth Third hit an all-time high when a bank manager explained to me that if I'm depositing my paycheck I need to tell the cashier to "cash out the paycheck and, then, deposit it" or the money isn't really available for approximately 24-48 hours, depending on the time of deposit. I actually bounced 2 checks to the tune of $70+ in fees when I went to the grocery and drugstore after depositing my paycheck into the account. I guess customers are supposed to know the secret password to have access to their own money. Unbelievable!
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2-16-2010 @ 4:42PM
JD said...
This is news? How? I'll tell you; because the banks have been controlling the press conferences. Does anyone ever go out on the street and just talk to people anymore, to see what they think. Everyone I know hates and mistrusts the banks and the credit card companies and with good reason. They suck!
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2-16-2010 @ 4:45PM
Glen said...
Hey Diane....I know the credit card reform thing sounds great, or maybe even good....and God knows it all needs reforming and regulationg, howevver, I saw some finance guy on the news (who was trying to make the reform sound like a good thing) explaining what credit card companies could still do and it made me wonder where exactly was the reform. There still is no interest limit, the card companies can still come up with made up fees, they can still raise your rates.....oh the one thing reformed, they have to apply your payment to the higher interest debt; but they've already come up with fifty new loop holes to recoup that loss in fees and interest rates. It all amounts to a show after all the compromises apparently. And yes, Republicans suck. That unfortunately is coming from a registered republican voter....no more.
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2-16-2010 @ 4:59PM
judy said...
I took my money out of Bank of America because the interest
rates they paid were much lower than the local banks. I guess
it's due to the huge overhead of these institutions not to mention
the greed of the management with their huge paychecks. I don't
think they are working for the customer instead the customer
is paying for the institution. Until it changes it's sayonara...
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2-17-2010 @ 4:24PM
Marck said...
Take your money out of the big banks... B of A, Chase, Citi, Wells, HSBC and put it in the smaller S&L's and local banks. Keep a small balance in the big banks accounts. Like $100... That costs them the most. Speak with your money and they will start to listen or go out of business as they deserve to.
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2-16-2010 @ 5:25PM
Sandy said...
I just cannot imagine why people do not trust the "big" banks.
They are rotton to the core. They brought about the recession
and they continue to treat customers like dirt. I would like to
see all of them go out of business and be replaced by regional
banks under the control of the states.
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2-16-2010 @ 7:23PM
Diane G said...
Yes and they can give their CEO's Big payout. Whose really paying for that. Is that the $35.00 everytime someone has an n/s fund weather it be the person with account or the bank itself. The Bank never does anywrong my Butt.
2-16-2010 @ 5:30PM
gdtrayler said...
Now lets ask who believes more in their bank than the whitehouse demo's. I trust my money with the banks more than I trust the whitehouse to do with it what is proper. We cry about the banks and think it is ok to get screwed by the government group.
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2-16-2010 @ 5:40PM
John said...
Listen, Everyone, put your Checking and Savings in Your Credit Union !!!
Credit Unions are YOUR Financial Instituions.
Credit Unions have Checking, Savings, Money Market Accounts, Low interest Loans, On Line Bill Pay, everything you need and deserve.
You'll be glad you did.
John - Ohio
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2-16-2010 @ 5:46PM
Robert Green said...
I've been a Bank of America customer for years. As banks merged and reinvented themselves, I stayed put, and that's how I ended up with BofA. They haven't dunned me with fees, and haven't cost me any extra money. But -- I'd consider moving, and wonder if this stops others as well -- I would have to deal with transferring direct deposits, re-doing online banking services, and maybe lose the ability to transfer funds to other accounts (including family members also with BofA). We are so electronically tied into our banks now, that it can be a major effort to make the move, plus we have to research other banks to see if they have features that are comparable to what we like, and factor in the convenience of nearby branches. Yes, I think I'm just lazy, but if BofA does something to irritate me at some point, I will start looking at options.
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2-16-2010 @ 5:56PM
Allen said...
I changed from BofA back in November as they became so difficult to deal with regardless of which branch office I went to. I now bank at a local credit union and the credit union represenative said that they have seen a 600% increase in business since the big three accepted the TARP funds and paid the big bonuses. I am glad I changed. Everytime Ipass the old BofA branch I used there seems to be less and less business (cars in the parking lot) than there was a year ago. I agree it is going to be difficult for them to revive their image. Most of these big banks are facing so much litigation and class action suits that it is no wonder they have to cheat the middle class any way they can their legal bills and settlements have to be massive.
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