Peter Verhaar thinks banks should learn to communicate properly with society.

Over the past two years the choppy financial waters banks have been floundering in seem to have calmed down considerably.

The results of next October’s stress tests will confirm this. Banks have been working on their capital position and there’s even talk of stock market flotation.

For this we have to thank the politicians, both MPs and ministers, and the supervising bodies.

Resistance

As was to be expected the – long overdue -proliferation of rules and regulations met with considerable resistance. I think the biggest breakthrough was the re-evaluation of the business model employed by banks, property managers and insurers which included imposing a legal ban on commissions.

The buzz word for financial institutions and their lobbyists the Dutch Association of banks NVB and the Association of Insurers became ‘client-focused’.  

I have filled 78 columns about this process at the last count and have always tried not to succumb to ‘banker bashing’. Our banks and insurers are simply too important for that. We may not like bankers but we can’t do without them.

Dialogue

It hasn’t been easy though. I have been continually surprised and annoyed at the apparent inability of bankers to engage in normal dialogue with all stakeholders: politicians, scientists, clients and society as a whole.

This lack of proper communication is not an incidental occurrence but symptomatic of the fact that banks and insurers, in spite of their crucial role, have no idea how to deal with a society which refuses to be fobbed off.

The latest illustration of this was the salary hike for managers at ABN Amro and ING’s plans to relocate its headquarters abroad. Both banks are perfectly within their rights to take these decisions and politicians, especially the finance minister, should learn to bite their tongues before speaking out.

But the banks should have considered how the news would affect clients. Being in the right and being perceived to be in the right are two different things.

CSO

I know I bang on about this but clearly the message needs to be driven home. Banks need to appoint a Chief Client Officer, no let’s call him or her a Chief Society Officer, with a wide-ranging mandate. If banks and insurers want to regain our respect they will have to learn to listen to us.

Being client-focused is not simply a slogan to print in fancy brochures. Actions speak louder than words. Then perhaps I won’t have to write column number 79.

Peter Verhaar was a co-founder of Alex investment bank and is now a financial columnist. This column first appeared on BNR Radio.