It is time to revive anti-trust to break up all excessive concentrations of corporate power and particularly the banking conglomerates that have been fueling speculation in global financial markets. To meet the financial needs of Main Street create a system of federally regulated, community banks that fulfill the classic textbook function of acting as intermediaries between local people looking for a secure place for their savings and local people who need a loan to buy a home or finance a business.
John Brissenden quotes David Korten
Community banks eh? I worked for the Bradford & Bingley Building Society between 1997 to 1999. In June 1997, as the Halifax membership voted in favour of demutualisation we were opening a hundred new accounts – each meeting the £1000 minimum deposit imposed to supposedly deter carpet baggers – per day at the branch in which I worked. We had to photocopy the application forms and leave a stack of them on the counter, such was the demand. People would fill them in, staple their cheques to the application and we’d work into the evening to open the accounts. Consider that this was in a northern town licked to a splinter by the loss of its traditional industry and you’ll get an idea of the fervour, greed and venality on display that summer.
When the inevitable happened, and a proposal was tabled by Stephen Major, the Country Antrim plumber and carpetbagger, to convert the Society into a PLC, we were expected to enjoin in the campaign to persuade the membership of voting in favour of remaining a mutual society. It was far too little, far too late. Every one of those thousands of new members had joined with the hope of another payout and were only ever going to vote one way. The board, led by Christopher Rodrigues, should have acted much sooner and more effectively, pace Nationwide, who introduced a clause that any potential windfall would go to charity. I suspect Rodrigues knew he’d walk away a very rich man regardless and very probably wanted it to happen.
None of this is to claim that the Bradford & Bingley was a latter-day Building & Loan, nor that the staff were as noble as George Bailey, nor to deny that Rodrigues and the board weren’t paid handsomely, nor that it always offered the best mortgage and savings rates (although it was never very far off), nor that we weren’t expected to flog travel insurance, contents insurance, to upsell, to maximise opportunities, as the lunchtime queue snaked to the door.
Rather for me it is the principle of returning profits to the membership, of not risking everything, of ultimately being rather staid and conservative when it comes to the responsibility of looking after peoples’ savings, that still appeals. So the Bradford & Bingley is mortally wounded and is surely now being predated as they come circling and sharking in for the kill. 370 jobs are the first to go.
Was it worth it Stephen Major? How much did you make? Did you keep your shares? Do you care? You went for the Nationwide next but mercifully you failed. Was it the money or the principle you objected to? God rot you and everybody else who wanted a quick buck.
September 26, 2008 at 8:29 pm |
I have worked for Halifax (before it demutualised), Lloyds TSB before it took over C&G and Portman B.S. before it merged with Nationwide B.S where I still am now. I have lived through the carpetbagging era and seen how the financial services industry has changed. Originally a service industry, now the sales culture has taken over completely! Whether bank or building society, you cannot hope to be served anywhere now without the efforts of staff, under constant pressure to sell mortgages, insurance and current accounts. The B.S.’s who demutualised were never big enough to compete effectively with the Big 5 and so tried to grow their businesses too greedily and quickly – hence the Northern Rock debacle. Soon B&B will be taken over and Alliance & Leicester have already agreed terms with Santander. So, demutualisation would appear to have been an abject favour.
I don’t believe we can pin the blame on the USA or even the carpetbaggers for the current problems in the UK – they didn’t help but the blame must be shouldered by the FSA, Government and all the greedy directors/CEO’s – the former two for condoning the aggressive sales culture and the latter for their greediness in lending imprudently.
What goes around comes around!
Personally, I yearn for the good old days of a building society, or bank where the customer was not viewed merely as a sales target but someone who was to be impressed with good service and care of their financial needs!
September 26, 2008 at 10:16 pm |
Hi Caz, even if I wanted to I couldn’t disagree that what has brought Bradford & Bingley to the brink of collapse is not explicitly the fault of the carpetbaggers. Nor can I say with anything approaching certainty that it would have survived this crisis (and notice how we have to employ the language they use?) if it had remained mutual. We haven’t yet seen the likes of the Yorkshire report difficulties and I suspect their more conservative business models are robust enough to withstand the worst of this
crisisclusterfuck exemplar of disaster capitalism engineered by Wall Street, in which they knew they’d get away with it and would shaft us in the process.I tend to only write whenever my gander is raised sufficiently and although this piece reads quite stridently, I’m still unsure if I’m being unfair on Stephen Major, a man whom I’ve never met and know nothing about. I tried to imagine how I’d feel now if I had been the one to have put in motion a chain of events which has led, inevitably, to this. I think I very probably would, but then I’d have never done what he did in the first place. For me, the political is deeply personal and I don’t intend for that to sound quite as pious as it does. I just wouldn’t have done it. In 1999 the scales had only just began to fall from my 24 year old eyes but I knew enough even then to know that Bradford & Bingley could never survive in the long term and that would inevitably lead to job cuts. Whilst Major was certainly not acting alone, and whilst if it hadn’t have been him it would surely have happened anyway, he and his ilk cannot, must not, be allowed to shirk responsibility. Nor can those who voted for conversion, who at best were wilfully naive and at worst were shamelessly greedy. They took the action that inexorably led to this invidious situation. I remember one woman, red-faced and indignant at the branch counter, who, as I passed her a leaflet adumbrating the reasons to remain mutual, leant forward and practically spat “I don’t care” at me before storming out. And that’s just the problem isn’t it? Nobody cares.
October 13, 2008 at 8:28 am |
Mr EG,
What’s happened to your other site. I can’t seem to access it. Problems?
Leeds9
October 21, 2008 at 5:04 pm |
I took it out back and shot it, Allistair. Nil desperandum and all that, because if you’ve a perfervid desire to read half-baked ad hominems interspersed with pictures of Charlotte Gainsbourg then this is the place to be!
October 22, 2008 at 6:15 am |
Well I do, so I am glad to see it is back up. And long may your ad-hominems continue to be half-baked. You ain’t pretending otherwise and they are all the more readable and truthful for it.