Any other business

Welcome back, TSB: your founder’s spirit is alive and well and living in Airdrie

14 September 2013

9:00 AM

14 September 2013

9:00 AM

A big hello to the revived Trustee Savings Bank — the spin-off of 631 Lloyds branches that were going to be sold to the Co-operative Bank to fulfil EU conditions for the bailout of Lloyds after its catastrophic takeover of HBOS. The new entity starts life with 4.6 million personal and small-business customers, a clean balance sheet, no investment banking arm and no foreign skeletons in its cupboard. That all sounds promising, but those of us who have long argued for a break-up of mega-banks and a return to relationship-driven high-street finance will watch closely to see whether the new TSB’s slogan, ‘Welcome back to local banking’, turns out to be just that, or a real mantra for change.

The crash of its online banking site within minutes of launch was an unhappy omen, as is the fact that ‘TSB’ is the bank’s full name, thus suppressing ‘trustee’ and ‘savings’ which might have offered useful reminders of how local banking ought to be run.

The issue now is whether TSB’s managers (led by ex McKinsey man Paul Pester) merely put a new marketing gloss on the same dehumanised service offered by larger established competitors — in the manner of those folksy, small-town NatWest ads of 20 years ago, at a time when NatWest was notorious for harsh handling of recession-hit small-business customers. Or will they reach back through two centuries of rebranding and repositioning to the spirit of TSB’s founder, the Revd Henry Duncan of Ruthwell, Dumfriesshire, in 1810?

An ardent social activist who raised a contingent of volunteers against the threat of French invasion, Duncan was described by Thomas Carlyle as ‘the kindliest of men’. The aim of his Ruthwell bank was to encourage the poor to improve themselves by saving for the long term: withdrawal was made difficult, savers who failed to deposit at least four shillings a year were subject to fines, but a handsome 5 per cent interest plus bonuses was offered to depositors of long standing. Anyone who aspires to buy a house on today’s mortgage terms, or to accumulate a nest egg to supplement the state pension, would do well to encounter a bank manager like Henry Duncan; perhaps he’s been lurking in Lloyds all these years, awaiting the rebirth of TSB.

Pillar of tradition

There is a surviving pillar of the true Duncan tradition, by the way: it is the Airdrie Savings Bank, founded in 1835, and the only one of its ilk that refused to join the 1984 national amalgamation which created the TSB. It holds £143 million of deposits, lends £52 million to customers, and has eight branches, of which the newest, in Falkirk, was opened in 2011 after a group of Scottish entrepreneurs came together to inject £10 million of deposits, in part as a gesture of dismay at the disgrace of RBS and Bank of Scotland. ‘Airdrie represents what Scottish banks once stood for,’ declared one new backer, the Stagecoach tycoon Brian Souter. ‘Security of funds, a focus on savings and outstanding personal service.’ Paul Pester and his team should pop up for a visit.

A world now gone

Geoffrey Goodman, who has died aged 91, was the doyen of Fleet Street’s industrial correspondents in an era when the word ‘industrial’ in any newspaper was far more likely to be followed by ‘dispute’ or ‘crisis’ than ‘success’. Had he been covering recent news from Jaguar Land Rover for the Daily Mirror (where he was industrial editor from 1968 to 1986), ‘Halewood workers call off strike after Unite accepts pay deal’ would have loomed as large in his copy as ‘1,700 new jobs at Solihull as part of £1.5 billion investment in chassis technology’. That particular form of balance survives today only in BBC regional newsrooms, where any upbeat business story has to be matched by warnings of doom from local shop stewards.

Goodman’s was a world now gone, in which trade union barons were as powerful as cabinet ministers, industrialists were in retreat against their own workforce as well as foreign competitors, and entrepreneurs were a rare breed. In old age, when I came to enjoy his company, he remained a passionate Bevanite socialist — but courteous in debate, always interested in opposing views. The point at which his friends of left and right met was in their collective disdain for the ethos of New Labour.

Goodman was also a great source of wisdom on the subject of press regulation, having sat on a Royal Commission on the subject in the mid-1970s. His view was that there was nothing new in modern journalists’ misbehaviour; only technology has changed. As a reporter on the News Chronicle in the early 1950s, he told me, he was expected to keep victims of crime or tragedy talking at their front door while the ‘picture snatcher’ — a professional burglar retained on the paper’s staff — broke in at the back and rifled the family’s photo albums.

Made for globalisation

An eye-catching aspect of this week’s Jaguar Land Rover story — bringing to 11,000 the number of skilled jobs created in the past three years by this renascent pair of British marques — was the unveiling of the aluminium-framed Jaguar C-X17 concept car, of which the chief designer, Ian Callum, is a Dumfries-born graduate of Glasgow School of Art. Perhaps more significantly, the additional investment in the Solihull factory was announced at the Frankfurt Motor Show by JLR’s Bavarian-born chief executive, Ralf Speth, who began his career as an engineer with BMW and moved on to work for the division of Ford that owned Jaguar and Land Rover before their sale to the Tata Group from Mumbai. As the former CBI chief and current Jaguar ‘ambassador’ Lord (Digby) Jones of Birmingham remarked to me the other day, ‘a British engineering brand with German managers and Indian money… I’m proud we have that in our DNA: if there was a nation made for globalisation, it’s us.’

Got something to add? Join the discussion and comment below.

You might disagree with half of it, but you’ll enjoy reading all of it. Try your first 10 weeks for just $10

Show comments
  • Alexsandr

    Airdrie Savings bank only paying 0.025% to savers.
    cant see many queuing to save at that rate
    Personal loans over 13%
    bank spreads are a disgrace, and a massive brake on the economy.

  • Duncan Richardson

    Ian Callum “designs” the appearance of motor vehicles. This is not the same as engineering them. I dont suppose he can “design”an engine, suspension etc. & should be called a stylist

  • Malcolm Johnston

    Sadly my first experience of TSB (or Lloyds – not sure which) is bitterly disappointing. I was informed yesterday that I cannot keep my Premier Account with Lloyds but must first transfer it from TSB (having told Lloyds TSB I didn’t want to move) to a local Lloyds branch but only as a basic account not Premier. I then must wait two months before I can upgrade to the account that I had in the first place. Given the importance of Premier Account “extras” such as travel and mobile phone insurance and breakdown assistance/ recovery and the fact that this “process” had not been communicated to me during the run up to the split, I am pretty miffed. Maybe Martin would like to put this issue to Mr Pester?

  • gressy1970

    I am baffled by the tedious moan of a small number of Lloyds TSB customers who don’t want to move to TSB. Every story about TSB has one of them in the comments section.

    It might be unfair you had to move, but what is the alternative? You cannot stay with Lloyds TSB as that no longer exists.

    Instead two new banks have been created one called Lloyds Bank, which disappeared from our high streets 18 years ago, and another called TSB, which also disappeared from our high streets 18 years ago.