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Recovering our Industry’s Reputation

 

Community banks and credit unions have unfairly been painted with the same bad-reputation brush as the Wall Street investment firms that contributed to the country’s financial unraveling in 2008. As evidence, in November 2009 The Harris Poll sampled more than 2,000 consumers, and only 12 percent said banks are “generally honest and trustworthy,” down from 21 percent in 2008 and 30 percent in 2007.

 

In addition, 40 percent of the same group believe banks “should be more regulated,” up from only 20 percent in 2007. These opinions should concern all financial institutions, as current consumer temperament could fuel further regulation.

 

A similarly bleak story was painted by 107 financial journalists polled by Market Wire and BackBay Communications. Eighty-three percent said the reputation of financial services companies had declined over the past year – 59 percent say “significantly” and 24 percent “only slightly.” These are the conduits through which consumers interpret your reputation.

   Leah Henderson
     

Time to Respond

Any attempt to unlink the reputation of your institution from the industry is unlikely to be successful. However, here are some actions you can take to fortify the reputation of your institution.

 

Back to basics – Customer service is more critical for financial institutions than ever. Focus on keeping existing customers happy. Remind them that you are a customer-focused institution working in their best interest.

 

Create smart consumers – Educate account holders about the benefits and uses of services and products – a win-win for institutions and consumers.

 

Connect and communicate – Leverage social media to connect with account holders on their terms.

 

Partner for success – Maximize your role as a valuable financial partner in managing your customers’ money; offer personal financial management.

 

Stay fee savvy – Re-examine your fee structure, especially in light of the change in overdraft policies that took place this year.

 

A good reputation is worth its weight in gold. Yours may feel like concrete shoes today, but the industry is on the road to recovery. Concerted efforts by financial institutions soon will have the industry’s reputation climbing again, one step at a time.