A survey published last week by American Banker seems to show U.S. banks are starting to recover from the PR disaster that was the financial crisis of 2008 and 2009. Perhaps unsurprisingly, the biggest banks that got the lion's share of the bad press during that period still lag smaller regional and national banks when it comes to public perception.
From Heather Landy at American Banker:
The results suggest that reputation, in recent years an albatross for the financial sector as a whole, is starting to look more like a point of differentiation, with several large institutions able to break away from the pack more convincingly as they moved to the top of the ranking.
The two strongest performers, Harris Bank and Zions Bank, both garnered scores above 70 on a 100-point scale. Last year, no bank broke the 70-point barrier, which the Reputation Institute, a brand consultancy, considers the dividing line between average and strong reputations. The highest score in the 2010 survey was 68.1, for New York Community.
A change in American Banker's size-based criteria for inclusion made New York Community ineligible for this year's survey, and thus unable to defend its title. But at least half of the David-and-Goliath theme that emerged last year continued into 2011, with Bank of America, Chase, Citibank and Wells Fargo taking four of the bottom six slots.
It's interesting that despite their huge advertising budgets and PR departments, the nation's biggest banks are still having trouble moving the needle substantially on public's opinion of them. My guess is that they won't fully recover until foreclosures and unemployment fall and the overall economy gets back on track; I don't think bad memories of massive bailouts and a financial system in crisis will fade until the consequences of that crisis have also faded.
But I'd also point out the fact that the biggest banks are currently making pretty big profits and don't seem to have any trouble holding onto and acquiring new accounts speaks to a truth about banking: convenience is king. For a lot of people, having plentiful branches and ATMs close by is a huge attraction, and they'll go with the bank that can provide those things regardless of hard feelings about that bank's perceived role in the current and past economic troubles.
What do you think? Do big banks deserve a bad reputation? What will it take for them to recover?