By John Connell

Last updated at 16:13, Friday, 06 July 2012

THE deputy chief executive of the Cumberland Building Society believes the company is benefiting from disillusionment in mainstream banks.

John Leveson

John Leveson said staff were seeing people looking to move their accounts who have “had enough” of the banks in the wake of the Barclays rate-fixing scandal.

He said it was “too early” to quantify the number of customers who were jumping ship.

But he urged those who were considering the move to give building societies a try as an alternative to the big banks.

Mr Leveson also believes that a conflict between the demands of shareholders for profits and the needs of customers may have led to some of the recent poor behaviour seen in the banking sector.

He said: “If you are a bank you have to make as much money as you can to please your shareholders.

“We don’t have that conflict between our customers and shareholders. They are one in the same to us.

“Customers are the members and members are the owners.

“But if you have to maximise your profits to please your shareholders it creates such a tension with your customers that may have led to some of this behaviour.

“I can’t prove that but it seems logical.”

He added that because a bank is a PLC, its “primary responsibility” was to its shareholders rather than its customers.

A group called moveyourmoney.co.uk was established two months ago to help disgruntled savers vote with their feet.

Since then about 8,000 people have moved their cash.

The group has also produced an ethical league table which ranks banks and building societies according to how they treat their customers, whether they pay their taxes on time and also on their animal welfare and human rights records.

The Cumberland stands at number two in the country for current accounts and at number five in its savings accounts.

Last week, the Cumberland Building Society gave hundreds of emergency cash payments to anxious customers who had not received monthly pension or salary payments because of a systems error by the bank RBS.

Mr Leveson added that building society staff had been “absolutely tremendous” and had worked extra hours to deal with a “monumental” problem not of their making.

He said that the RBS system errors now appeared to be “fully resolved”, with all transactions up to date.

Meanwhile, the Co-operative Bank, one of the few unsullied by the latest scandal, has seen a 25 per cent increase in online applications week on week.

The change in public attitude follows the Barclays rate -fixing scandal and the computer meltdown at RBS NatWest. The Financial Services Authority (FSA) also ruled recently that Interest Rate Swap Agreements (IRSAs) have been mis-sold to small businesses.

First published at 14:07, Friday, 06 July 2012
Published by http://www.cumberlandnews.co.uk