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Should a bank be called a bank

After Richard Branson's Virgin Money successfully acquired Northern Rock, loads has been written about the takeover.

Much has been negative, saying that the Chancellor did a bad deal and ‘gifting’ the bank to Virgin, losing £400 million in the process.

A lot of other dialogue has been positive, saying that the Chancellor got fair value by selling for £1 billion which is the book value of the bank.

You can read all you want, there’s copious amounts, but what many failed to notice is that the Chancellor made a follow up statement after the headlines hit the fan, stating that the previous government under Gordon Brown had agreed with the European Commission that, under competition rules, the bank would be returned to the private sector before 2013.

Therefore, with all bank shares halving over the past few months, now was the best time to get a deal.

Meanwhile, Richard Branson is being outspoken himself, saying that he wants to drop the name "Bank" from their business.  

Bank is a tarnished word he believes, and blogged about it as such: "should a bank be called a bank". 

The Bearded Wonder says he’d rather call it Virgin Rocks.

The majority of over 200 comments appear to agree, although they prefer the name Virgin Rock, and it’s interesting to note some of the commentary. 

For example, Lynn Madeley says:

“I don't think it matters what you call it. Look how much effort went into calling Orange Orange, when it was originally launched as Rabbit. The Virgin Brand is not meant to be average and ‘Bank’ is a very average word. HSBC has banking in its name but no-one calls it Hongkong & Shanghai BANKING Corporation. So Virgin Rock is pretty cool. Love the fact that you are asking peeps about this, not a very banky thing to do, all the more reason not to have it in the name.”

The power of the social web.

Meanwhile, Robert Mochart responded with:

“When we first were thinking of a name for ING, we asked the same question. Knowing people were adverse to the word bank, we chose to use bank for its official name but for marketing and functional purposes, we used ING Direct.”

Maybe this is why Banksimple has been renamed Simple, which I hate as it implies Stupid, and why we may see many other banks without bank names.

Mind you, we have many already: First Direct, Cahoot, Smile  … it’s nothing new.

Meantime, I’m loving this week's Private Eye which is full of Virginal fun:

Branson

The best comment they picked up on was a blooper from Peter Allen on BBC Radio 5 Live, who said: “It has been announced that Northern Rock has been sold to Virgin Mary”.

He meant Virgin Money I’m sure, but the Virgin Mary, Father, Son and Holy Ghost may be just what British Banking needs to get it back on its feet.

Or Richard Branson maybe.

 

 

About Chris M Skinner

Chris M Skinner
Chris Skinner is best known as an independent commentator on the financial markets through his blog, the Finanser.com, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal’s Financial News. To learn more click here...

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