According to the ‘Banking 500‘, NatWest, RBS and Nationwide all saw their brand values fall. Coutts was the worst affected; The Queen’s bank has lost 42 per cent of its brand value in a year.Standard Chartered was fined $327m by US authorities for violating sanctions against Iran but the reputational impact has clearly had an even bigger impact on its financial position; brand value is down by nearly $2bn (£1.3bn). HSBC remains the UK’s most valuable bank brand, with a value of $27.3bn (£17.5bn). Both HSBC and second placed Barclays have registered negligible growth rates of 1.5 per cent and 0.1 per cent respectively. They, along with most UK banks, have been significantly affected by a toughening regulatory regime. Brand Finance’s results suggest that CEO Antonio Horto-Osorio has masterminded a successful turnaround. Renovated branches and a refreshed image suggest a new confidence, helping to distance Lloyds from the problems of the company’s recent past. Recently revived TSB has fared even better and is the UK’s most successful bank brand this year, having grown by over 21 per cent. Its marketing has emphasized not only its competitive rates but also the importance of straightforwardness, trust and heritage. It leads a field of increasingly successful challenger banks, putting more pressure on the established players. Brand Finance CEO David Haigh said: “A strong brand builds loyalty, helping to reduce churn. As switching becomes easier and with nimble competitors emerging, some banks may have to rely on the power of their brand ever more heavily to hold onto customers.”
Wells Fargo remains the world’s most valuable bank brand. Following growth of 15 per cent, its total value stands at $34.9bn. Some other US banks have registered respectable brand value growth such as Citi and Chase (both up seven per cent) while others such as Bank of America (-four per cent), Goldman Sachs (-seven per cent) and JP Morgan (-15 per cent) are in the doldrums.
JP Morgan chief executive Jamie Dimon recently expressed concerns that overregulated western banks might be superseded by Chinese brands.
ICBC has moved from sixth to second place in the rankings, overtaking HSBC which is now in third globally. China Construction Bank, which has already overtaken HSBC in terms of market capitalisation, has grown its brand by 39 per cent to overtake Citi, BoA and Chase. Spain’s Santander has been pushed to the bottom of the top ten by Bank of China and Agricultural Bank of China.
European banks have had an even less successful year than those from the US. Total Spanish bank brand values are down two per cent, for the UK the figure is -three per cent, Italy -five per cent, Germany -six per cent and France -19 per cent.
By Shané Schutte
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