Who to trust? Consumers pan big banks but favor credit unions, certain regional banks
Wake up and good morning. What do you think of your own bank? Would you, the consumer, be a strong advocate for your bank? Does your bank take your side in disputes? Does it do what is right even if it’s not required by regulation to do so? Does it give fair rates or performance comparisons? And is it clear about charges and fees?
Forrester Research recently asked questions like these to about 4,500 consumers and, no shock perhaps, most of the nation's biggest banks failed miserably. The bottom seven of this year’s rankings, first to last, are Bank of America, Chase, Capital One, TD/Commerce, Fifth Third, Citibank, and in last place with the lowest score ever recorded, HSBC. Many of these -- especially Bank of America, Fifth Third and Chase -- are prominent players in Tampa Bay and Florida markets.
Consumers were asked this question: My financial provider does what’s best for me, not just its own bottom line.
Among Bank of America customers, 33 percent agreed with the statement above, while 31 percent of Chase customers agreed, 29 percent of Capital One customers agreed, 28 percent of TD/Commerce Bank customers agreed, 27 percent of Fifth Third Bank customers agreed and 26 percent of Citibank customers agreed.
Wells Fargo/Wachovia -- one big bank that, like Bank of America, dominates Florida banking -- did better with about 40 percent of its customers saying they believe the bank does what is best for them. Forrester Research said Wachovia’s customers probably raised Wells Fargo’s ratings. Wachovia, recently acquired by Wells Fargo, has generally done substantially better in the rankings than the other big banks. There's more detail on the bank rankings in this New York Times story and at Forrester Research.
Let's face it, it's been a terrible time to find much confidence in banking. According to the 2010 Edelman Trust Barometer, in the United States, trust in all industries has recently increased -- except in banks which went from being one of the most-trusted sectors before the recession (third behind technology and biotech in 2008) to near bottom of the list, declining from 71 percent to 33 percent in two years. "It is, by far, the most dramatic decline in trust in any sector of any country tracked," the barometer said..
* Credit unions ranked much higher than the big banks, as usual, with 70 percent of credit union customers saying their financial institution puts their interests first.
* After credit unions, the bank run by USAA, a financial services company that serves the military and their families, came in next with 64 percent of its customers agreeing with the statement. It was followed by ING Direct, with 46 percent. Regional banks including PNC, U.S. Bank and BB&T (and yes, BB&T is more prominent in Florida now that it acquired Colonial Bank) came in next with rankings similar to Wells Fargo/Wachovia.
* Insurance firms remained the highest rated firms for customer advocacy with more than half of all customers rating their insurers high on customer advocacy and insurers representing two-thirds of the firms in the top half of the rankings.
-- Robert Trigaux, Times Business Columnist