Coutts Performs Volte Farce - Offers To Reopen Farage's Accounts

 

Nigel Farage has said that Coutts is offering to keep his personal and business accounts open. The former Ukip leader had previously accused the private bank of closing his accounts because of his political views.

Farage said that he had received a letter from the new chief executive of Coutts, Mohammad Syed, offering to reinstate his accounts. Syed said that he had "reconsidered the decision" to close Farage's accounts and that he was "happy to welcome him back as a customer."

Farage said that he was "grateful" for the offer, but that he was still considering his legal options. He said that he wanted to understand why Coutts had originally closed his accounts and that he wanted to ensure that no other customers were treated in the same way.

The decision by Coutts to offer to reinstate Farage's accounts comes after a period of intense public scrutiny. The bank has been accused of political bias and of discriminating against customers on the basis of their political views.

In response to the criticism, Coutts has said that it is "committed to providing a fair and impartial service to all of our customers." The bank has also said that it is "reviewing its policies and procedures" to ensure that no other customers are affected in the same way as Farage.

It remains to be seen whether Farage will accept Coutts' offer to reinstate his accounts.

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Costa Coffee Currently In Doubling Down Phase of Brand Destruction

 

Costa Coffee is currently in the doubling down phase of brand destruction (before it conducts a 180 degree U turn and admits it got wrong).

My sympathies to the shareholders of Coke (the holding company), this will give your shares a wobble.

I wonder why it is that companies never learn that fucking around with your brand and your customer base is never a good idea?

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National Express Fucks Up Its Branding and Talks Bollocks!

 via @TimesBusiness morning email

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Samsung In Meltdown Over Exploding Phones

I fell asleep on my Samsung Note pic.twitter.com/Ljc34N4sqE

— RANsquawk (@RANsquawk) October 11, 2016

Samsung can't catch a break with the Galaxy Note 7.

Samsung recalled 2.5 million phones in September after complaints of exploding batteries, and later insisted that all replaced devices were safe.

However, there are now reports that even those phones were catching fire.

Samsung has urged owners of the Galaxy Note 7 to turn off the phone while it investigates new reports of the device catching fire.

The firm also said it would stop all sales of the phone.

The key issue here is not the fact that the phones seem to have a serious technical flaw, but that Samsung dragged its heels wrt denials actions taken when problems were first reported.

It's the lie that gets you!

Project Transform - Barclays Faces An Uphill Struggle

Barclays has announced that it will cut 3,700 jobs (1,800 of them in its investment banking division) and £1.7BN of costs, as part of Project Transform which is designed to restore confidence in both its finances and its tattered reputation.

As Barclays fully realises a good brand and reputation takes years to build but days to destroy, the uphill struggle to restore confidence will take many years.

The Linkedin Security Breach

Linkedin have yet to tell its members about the recent security breach that may have put millions of passwords at risk (reports now indicate that well over 6 million may have been hacked), or advise them as to what they should do.

This is not an example of effective crisis management, and will damage the brand, reputation and share value of the company.

Those of you who have a Linkedin account should not wait for Linkedin to contact you, but are strongly advised to change your passwords to new, more secure and unique ones.

Money Lenders Hated For Five Thousand Years

Stephen Hester, CEO of Royal Bank of Scotland, has been visiting a school and businesses in Streatham.

During a Q&A session it seems that Hester is resigned to being "unpopular", as he wryly noted that "people have hated money lenders for five thousand years".

Sony Experience Ratner's Moment

Sony, who one would have thought paid vast sums to its media "professionals" to avoid brand damaging publicity, has managed to emulate Gerald Ratner's infamous "we sell crap" comment by being associated with a pop group under its management that wore Nazi style uniforms in an MTV broadcast.

Unsurprisingly, the Simon Wiesenthal Center in Los Angeles had voiced its "shock and dismay" at the appearance of the six-member J-Pop band Kishidan.

Brands are hard to build, but very easy to destroy.

The Shabby Habit - How Low Will a Bank Go?

Given the lousy, but very well deserved, reputations of many banks it is hard to find a story that actually plumbs new depths wrt how badly they treat their customers.

However, the Times reports that Santander has plumbed new depths in the way it mistreated one of its customers over the theft of £10K from her Abbey bank account.

"Emma Woolf, a longstanding customer of the bank, had £10,000 withdrawn from her account without her knowledge, but Santander, formerly known as Abbey, refused to refund the money and instead suggested that her fiancé, Jonathan Groman, had stolen the cash.

The bank relented and returned the money more than a year later only when the police arrested a Santander employee for fraud, after finding financial documents of customers in her home. But the bank agreed to pay back the cash only if Ms Woolf signed a confidentiality agreement. The bank also refused to apologise to Ms Woolf and Mr Groman."

It seems that the banks have yet to realise that the rules of the game have changed, and that they are no longer "respected" or "trusted" as they once were.

How To Destroy Brand Value

The ongoing safety issue wrt Toyota, and the company's handling of the issue, highlight how brand value (so painstakingly built up over the years) can be so very easily and quickly destroyed by an inept and unresponsive management.

The Times has added fuel to the fire by reporting that Toyota was forced hand over to US congressional investigators a memo produced in 2006, by its own factory workers, concerning issues over car safety.

The memo was sent to Katsuaki Watanabe, president of the company in 2006, and condemns "safety sacrifices" made by the company in pursuit of profit.

It noted that that vital processes were in the hands of "amateurs".

Toyota is learning the lesson that all businesses must learn, no business lasts forever.

BA On The Precipice

The prospect of a BA strike this month looks highly likely. BA have retrained a thousand staff to keep flights going, and have chartered 23 aircraft and crew from rival airlines to fly out of Heathrow if the strike does go ahead.

Whilst this may keep the flights going, more or less, the damage done to the brand and finances of the company are such that its future existence will be seriously jeopardised.

No company, let alone an airline, is immortal. The union and management need to remember this before they push BA over the precipice.

RBS Slips Deeper Into The Mire II

Hot on the heels of the news that the Royal Bank of Scotland (RBS) will have to conduct a forced sale of some of its well known brands (eg Churchill) and that a further 3700 jobs (on top of the 16000 already lost) will have to go, RBS have also announced that it will be deferring the bonuses of higher paid members of staff (over £39K per annum) and board members until 2012.

RBS and Lloyds will defer bonuses in return for an additional £40BN of our money.

Part of the bonus payments will be deferred, and part will be paid in shares; ie there is no "bonus cut" as such, merely an adjustment as to how and when the bonuses will be paid.

Given that these two banks are in a complete mess, I don't fully "grasp" how it is that any senior manager is entitled to receive a bonus.

I would also note that by paying part of the bonuses in shares, the current shareholders will find their holdings diluted, and the management will be incentivised to talk the value of the shares up in future in order to maximise their personal gains.

Is this really an improvement in the corporate governance of these two failed banks?

RBS Slips Deeper Into The Mire

Royal Bank of Scotland (RBS), the wreck of a once fine bank now 70% owned by the taxpayer, saw its shares fall by up to 14% this morning as it announced that it may be forced by the EU to sell more assets than planned.

Quote:

"It remains RBS's goal that any required divestments do not threaten its recovery plan."

Up for possible sale are Churchill, Direct Line and Green Flag insurance operations; along with more than 300 bank branches and its Global Merchant Acquiring card-processing unit. It may also have to downsize its investment banking arm.

Whilst these brands all have value, being part of the forced sale will inevitably reduce much of that value and the price that RBS hopes to be able to extract from any deal.

The forced sale is in order to satisfy EU policy that attempts to ensure that RBS doesn't have an unfair advantage in the market. The EU is also gunning for Lloyds Banking Group, which may have to sell assets and branches, and Northern Rock which is splitting into two.

Alistair Darling tried to spin this positively yesterday, by saying that the creation of three new banks will stimulate competition.

All very well, but if this is such an important issue, why did the government not intervene some years earlier in order to stimulate competition and provide consumers with more choice?

Postman Prat

It seems likely that there will be a post strike on or after 22 October.

Whether or not one occurs, the damage to Royal Mail's brand and the long term job prospects of those who claim to be striking for an "improved" postal service has already been done.

Royal Mail customers are already seeking alternatives to the increasingly erratic service, and will never return to the Royal Mail.

Mail volumes are already falling at around 10% a year.

Business Post says it anticipates a 10% rise, while Parcel2Go says a strike will lead to a 20% increase in turnover.

The strikers will soon be looking for alternative employment. They have not seemingly understood the precariousness of their situation.

Famous Names Scrapped

Abbey, Alliance & Leicester (A&L) and Bradford & Bingley are to be scrapped; or at least their names are to be consigned to the dustbin of history.

Santander, the Spanish banking group that owns all three brands, has announced that it will re brand them under the "flame-logo" and Santander name by the end of 2010.

Given that the above names currently exist and function side by side in many highstreets, it is fair to assume that once the re branding has occurred the next step will be staff cuts and office closures.

Dunfermline Building Society "Saved"

The Dunfermline Building Society has been broken up, with its non toxic elements going to the Nationwide Building Society; whilst the taxpayer has bought the toxic assets.

Under the deal the Nationwide absorbs the brand name, £2.3BN of retail deposits, 34 branches and £1.02BN of mortgages.

The taxpayer takes on poor quality buy-to-let loans.

FYI, the Dunfermline Building Society resides not a stone's throw from Gordon Brown's constituency. Fortunately for Brown, with only a few days to go before his much vaunted G20 summit, he will be saved the embarrassment of seeing his local building society going bust.

Back From The Dead

It would seem that the much lamented corpse of Woolworths may be about to rise from the grave, albeit in a reduced form.

Shop Direct has bought the name, and intends to relaunch it online this summer.

Needless to say, as Shop Direct already owns other brands (eg Littlewoods and Kays) and that Woolies will only be an online presence there will be little opportunity for many of the old staff to be rehired.

Indeed, Shop Direct announced jobs cuts last week.

HBOS Scales Back

HBOS announced today that it will axe 425 job cuts, and scale back its TMB brand which provides finance for new builds and buy-to-lets.

HBOS recently announced a fall in profits of 72% to £848M.

As from late August, HBOS will cease taking on new business from its TMB division and stop offering loans via its Intelligence Finance brand.

The FT reports that the UK mortgage market will shrink from £368BN in 2007 to £280BN this year because the "number of lenders who relied on securitisation have quit the market".

Banks Face Defeat

In a rare piece of good news for the hard pressed indebted public, today the High Court will hand down judgement on whether or not the Office of Fair Trading (OFT) can rule that bank charges are unfair; it is expected that the ruling will go against the banks.

If the OFT wins, it is then expected to decide that bank charges are too high.

However, even if the OFT does win and make that call, the banks will find other ways to charge their long suffering customers. Most likely the banks will introduce a charge for all account holders.

In the event that the court decides that some terms and conditions are subject to fairness assessment, while others are not, there will have to be further hearings to decide the exact level of charges.

Suffice to say, whatever the outcome, the brand image of banks and other financial institutions is at an all time low.

Bloodbath at The Rock

After weeks of mounting pressure, following the destruction of Northern Rock, the CEO (Adam Applegarth) has finally been persuaded to fall on his sword and resign.

Applegarth will leave by the end of January.

His is not the only head to role in this debacle, that has seen not only a major brand/bank destroyed, but the first run on a British bank in 140 years (thus severely damaging the credibility of Britain's financial system and that of the regulatory authorities).

Matt Ridley, the much maligned and invisible chairman, resigned in October; the bank has now announced that four non-executive directors - Sir Derek Wanless, Nichola Pease, Adam Fenwick and Rosemary Radcliffe - will step down with immediate effect.

Applegarth earned £1.36M last year. Northern Rock refused to comment on whether Applegarth would receive a compensation package when he leaves the business. The more pertinent question is whether they actually would have the funds to be able to pay him.

Rock also stated that three further directors - David Baker, Keith Currie and Andy Kuipers - would step down from the board, although they would remain officers of the company.

A complete shambles, and a humiliation for Britain's financial services industry and regulatory regime.

What other horrors are lurking in the woodwork in other banks I wonder?