One in five Co-op Bank customers want to switch
Almost one in five Co-operative Bank customers are considering leaving the beleaguered company, according to exclusive Moneywise data.
Following a scandal-hit year, some 18% of Co-op Bank customers said they are currently considering switching to another current account provider - a significant swing from the 4% who said they would leave Co-op this time last year.
The data was extracted from the results of the Moneywise Consumer Opinion Survey, which form the basis of our Customer Service Awards. More than 35,000 people voted in the 2014 survey, making it the biggest and most robust survey of its type in Britain.
The 14 percentage point change in the number of Co-op customers contemplating jumping ship over the past year is one of the biggest annual swings in customer sentiment Moneywise has seen of any bank in the six years the survey and awards have been running.
When asked why they were thinking of switching providers, Co-op customers said their decision had been influenced by some of the recent scandals the bank has been embroiled in.
In June 2013, Co-Operative Bank chairman Paul Flowers resigned after the bank got into financial difficulties - it was later revealed that he had a drug problem. Earlier this month, the Co-operative Group reported the worst set of financial results in its 150-year history, recording a £2.5 billion loss in the year to December 2013, with the banking arm accounting for £2.1 billion of the total.
Unethical and incapable
The Co-op is "not ethical anymore," said one survey respondent. Another said there had been "mishandling of the whole bank". One wrote: "Flowers was incapable of handling this bank and destroyed it." Another said: "They portray themselves as an ethical bank yet the behaviour of their board would show they are not living what they portray."
Others took offence to the "abandonment of mutual ownership" and one participant cited the "£100k donation to Ed Balls" the bank makes annually to the shadow chancellor and the rest of the Labour Party.
Only serial corporate offender RBS, and TSB - a bank some customers didn’t ask to join - are experiencing a similar proportion of customers thinking about leaving. The percentage of customers considering switching were 21% and 18% respectively.
In a further blow to the troubled firm, the Co-operative Bank has also failed to make the shortlist for the Moneywise Customer Service Award for Most Trusted Current Account Provider for the first time since 2009.
Andrew Hagger of Moneycomms said: "It was inevitable that the series of high profile damaging media reports would have an impact on the confidence of some Co-op Bank customers.
"At branch level the excellent customer service and good-value core banking products haven't changed. However, boardroom and financial issues mean that the wider Co-op Bank reputation has taken a hit."
Niall Booker, chief executive of The Co-operative Bank, told Moneywise: "We are disappointed to see that the customers in this survey are considering leaving the bank. We have been greatly heartened by the loyalty of our customers who have stuck with us through some extremely testing times over the last 12 months. With the increase in capital, improvements in governance and other actions underway the bank is in a much stronger position.
“Past issues are not a reflection of how the bank is run today or the quality of our customer service, which has continued to be ranked among the best in the industry. Our customers should be in no doubt of our commitment to return to our roots, focused on individuals and small and medium-sized businesses with values and ethics at our heart.
"A bank run on co-operative values is more relevant today than ever and we are determined to prove to customers that if they still believe in those values and ethics then we should remain their bank of choice."
He added: “We are reassured to see that that the survey also short-listed the bank in categories for the best current account call centre service and the best current account online service. The service ethic of the bank remains one of the things we are most proud of and continues to differentiate us with our customers."
The full shortlist for the 2014 Moneywise Customer Service Awards can be viewed here. The winners will be announced at a ceremony in London on 12 June and posted online at moneywise.co.uk.
An account opened with a clearing bank (few building societies offer current accounts) that provides the ability to draw cash (usually via a debit card) or cheques from the account. Some pay fairly minimal rates of interest if the account is in credit. Most current accounts insist your monthly income (salary or pension) is paid directly in each month and they offer a number of optional services – such as overdrafts and charge cards – which are negotiable but will incur fees.