So far, more than two-thirds of respondents to our poll think big bank’s reputations have taken such a hit that customers either will or may follow the advice of the Huffington Post and shift their money to community banks.
But Stuart Gunn, a partner at Bridge Strategy Group, a Chicago consultancy, has serious doubts.
As with any grassroots effort, nobody can be certain whether or not Arianna Huffington's Move Your Money Project will produce noticeable results. However, our firm's quarterly Consumer Financial Pulse suggests that consumer inertia is a strong force, and movement of deposits from the national banks to smaller institutions is likely to be minimal.
According to research conducted throughout 2009, 41% of consumers somewhat or greatly distrust national banks, versus 19% and 17% for local banks and credit unions respectively. Furthermore, 37% of consumers indicate that their level of trust in national banks has declined since the financial crisis began, versus 14% and 10% for local banks and credit unions.
Despite this apparent trust gap, only 7% of consumers indicated that they had switched institutions since the financial crisis began. When asked why they switched, traditional reasons of pricing and service problems were more prevalent than concerns related to the crisis. And those who moved accounts from a national bank were more likely to end up at another national bank than a local institution.
So, will the Move Your Money Project succeed? Perhaps, but we'd bet on consumer inertia.
Gunn isn't alone. As thrilled as they are by the campaign, co
mmunity bankers themselves doubt it will be terribly effective.
You can view the latest poll results here.