High net worth investors generally remain loyal to big banks, despite the Occupy Wall Street Bank Transfer Day last fall, but a new industry study shows that large financial institutions still risk losing customers on the hunt for better service.
More than 10 percent of consumers - with $675 billion in deposits and $92 million in fee revenue - are likely to switch primary financial institutions in 2012, according to a new report from Javelin Strategy and Research. The largest banks, particularly Citibank and Bank of America, face the highest risk of defections.
“Ultimately, consumers are driven by convenience more than fees and protests,” said Jim Van Dyke, president of Javelin. Giant banks can compete for customers with “messaging around convenience, mobile banking,” said Van Dyke, while smaller banks “can play to their strengths of lower fees, convenience and, and customer service.”
High net worth investors generally remain loyal to large banking institutions, according to Millionaire Corner research, which indicates that less affluent investors are more likely to be influenced by the Occupy Wall St. Movement.
“High net worth investors overwhelmingly prefer large national banks providing many services under one roof,” according to Catherine McBreen, president of Millionaire Corner. Of particular importance to high net worth investors are online access to accounts and paperless delivery of statements.
“One of the lessons of Bank Transfer Day was consumers had an opportunity to switch, but stuck with their bank, mostly for reasons that are about practicality, of having a large ATM network or a robust online banking platform,” Mark Schwanhausser, a senior research analyst for Javelin, told American Banker.
The top five banks used by Millionaire investors are Bank of America, Wells Fargo, JP Morgan/Chase, PNC and USAA, according to a study conducted by Millionaire Corner over the third quarter of 2011.
A study from the fourth quarter of 2011 shows that Millionaire investors, who have a net worth of $1 million to $5 million not including primary residence, appear to hold Wells Fargo bank in the highest esteem.