Should America's Biggest Banks Fear This Man?
It's no secret that the nation's biggest banks have suffered a wave of public scorn since the financial crisis, with megabanks like Bank of America , Citigroup, JPMorgan Chase , and Wells Fargo consistently scoring at the bottom of opinion surveys. Just this past summer, fellow Fool John Maxfield highlighted one such poll, which noted that both customers and non-customers reviled these banks -- particularly Bank of America.
Still, customers haven't been fleeing the banking behemoths in favor of smaller banks, with the big four currently hogging the lion's share of deposits. A banker from Needham, Massachusetts is looking to change all that, however, and has created a website exalting the small-town banking experience -- and denigrating big banks like Bank of America.
Small-town banker looking to make big changes
Eric Morse, a vice president at Needham Bank, notes on his site's About Us page that SwitchToCommunity.com is made up of a "few individuals... sick and tired of the avarice of Wall Street." The site encourages consumers to switch to a local bank, using the site's search engine, and calls upon other bankers to join in the community banking "movement." The home page features local banking news, as well as the latest scoops on legal settlements involving Bank of America, JPMorgan Chase, and Wells Fargo.
The idea of a website that seeks to increase the ranks of community bank customers by pointing out the foibles of megabanks is unusual, certainly, but is this movement a real threat to the big boys?
Big banks have their own advantages
Unfortunately for small banks, customers don't always prefer the small-town touch. A recent survey noted that, in fact, many consumers who don't care all that much about particular banking services will often choose regional banks. Customers who shop by price -- for example, free checking or ATM access -- will generally choose a smaller bank, while those who are looking for reward debit cards will settle on big banks.
Another reason community banks can't always win over megabank customers has to do with convenience. Although mobile banking has been cited as one reason for the closure of branch locations, a new study shows that consumers still crave the branch experience, with 70% of those polled saying they had used a bank branch within the past two weeks. When it comes to a national network of branch locations, the top three banks are Wells Fargo, JPMorgan Chase, and Bank of America, respectively.
Morse's concept is fairly new, and he's working hard to spread the word. Currently, he's trying to entice another 11 banks to join him, but he will surely need scores more to be considered any threat to the big banks. If his idea takes hold, it is conceivable that similar sites springing up across the country could, eventually, make the big guys sit up and take notice. Until then, SwitchToCommunity.com is unlikely to concern the banking world much at all.
Rock-solid investment advice
Many investors are terrified about investing in big banking stocks after the crash, but the sector has one notable stand-out. In a sea of mismanaged and dangerous peers, it rises above as "The Only Big Bank Built to Last." You can uncover the top pick that Warren Buffett loves in The Motley Fool's new report. It's free, so click here to access it now.
The article Should America's Biggest Banks Fear This Man? originally appeared on Fool.com.Fool contributor Amanda Alix has no position in any stocks mentioned. The Motley Fool recommends Bank of America and Wells Fargo. The Motley Fool owns shares of Bank of America, Citigroup, JPMorgan Chase, and Wells Fargo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.