l deal with TD Canada Trust and TD Waterhouse and find each helpful. I have been a TD customer for more than 50 years. I have tried other banks, but they have never compared well.
Recently I talked to a client who is moving his banking business (not at TD) to another institution. He has dealt with his now former bank for 59 years. He feels betrayed because they refused to make a first mortgage loan of 40% of value on his rural property. (Three miles from a city and with his home on the property.) His new bank agreed to do it after looking at the property on Google Earth and getting a copy of his Income Tax Assessment. Something gets in the way of customer service.
I don’t know how much a bank would spend advertising to acquire a new and loyal multi-millionaire customer, but I suspect it is more than nothing. Why then is keeping customers so hard for them? Because they have bonuses for growth, but mostly you don’t get bonuses for having happy customers. No metric measures that.
It is becoming worse with banks. Most charge ridiculous premiums for poor quality life insurance. Some provide customer service only through a banking machine. Most have well meaning but unskilled people facing the customers. I had an investment person at another bank tell me how their equity linked GICs were connected to the return on “a bunch of blue collar stocks” Perhaps she misspoke.
Banks, to a considerable extent, rely on their antecedents for their current credibility. At one time they were bastions of common sense and conservative economic thought. They treated customers as if they were important. They stayed in their own lane and did not try to be financial supermarkets.
Today, it is a numbers game and few understand that their offerings and advice matters to many of their customers. Given what they provide, I don’t see how that ends well for them.
I recall the headline on an article decades ago that made the assertion, “Banking is necessary; banks are not” If it was true in the 70s, imagine how much more true it is now.
Recent performances in banking, like Wells Fargo, clearly show that they have lost their way. I think Peter Lynch may have the most cynical comment.
“There was a time when people robbed banks. Now we are lucky if it is not vice versa”
Investing in large banks may not be as riskless as it appears. Especially true if the government tries to shake more of them down as with Deutsche Bank.
Don Shaughnessy arranges life insurance for people who understand the value of a life insured estate. He can be reached at The Protectors Group, a large insurance, employee benefits, and investment agency in Peterborough, Ontario. In previous careers, he has been a partner in a large international public accounting firm, CEO of a software start-up, a partner in an energy management system importer, and briefly in the restaurant business.
Please be in touch if I can help you. firstname.lastname@example.org 866-285-7772