Blog article
See all stories »

What's the difference between Hbos and HSBC?

What's the diference between Bank of America and Wells Fargo? Citibank and JPMorgan Chase? Royal Bank of Scotland and HSBC? Hbos and Barclays?

From a consumer perspective, very little. They all offer much the same products, charge much the same fees, and use much the same distribution networks.

For sure, some may be better capitalised than others. But if those that aren't are deemed too big to fail, what do I care?

Economic realities may mean that national governments have no choice other than to prop up their ailing institutions, but it's a missed opportunity.

Rather than pour all the money into a creaky life support machine for an undifferentiated banking dinosaur, why not set a little aside for a hedge on a brighter future. An incubator fund to nurture a new breed of banking institution, that takes its cue from modern technology to drive down cost income ratios, get closer to customers and set new standards for innovation and consumer satisfaction.

It's already happening in the capital markets space, where a new generation of nimble multi-lateral trading facilities are successfully taking on the incumbent national stock exchanges.

After all, if you were to build a retail bank that was fit for purpose in the 21st century, would you mimic the behemoths spawned in the pre-Internet, pre-PC, pre-mobile 20th century? Or would you create something entirely new?


Comments: (2)

Michael Fuller
Michael Fuller - None - London 26 February, 2009, 22:31Be the first to give this comment the thumbs up 0 likes

The difference is trust.


Sure I'll spend a few dollars on eBay using PayPay but I trust my Bank each month with thousands of dollars of my income. As for undifferentiated some of the strongest global Brands are Banks. Some brands will suffer but others will thrive.


Nothing yet makes me want to switch from a brand I know and trust to something new and unknown. (I'm not talking about RBS obviously).

Paul Penrose
Paul Penrose - Finextra - London 27 February, 2009, 10:31Be the first to give this comment the thumbs up 0 likes

Trust? Banks? Surely a contradiction in terms these days.

Paul Penrose

Paul Penrose

Head of Research


Member since

06 Oct 2006



Blog posts




More from Paul

Blog post

ANZ and Visa lose the plot

Blog post

Now we are ten

Blog post

Finextra's Best of the Web

This post is from a series of posts in the group:

Futuristic Banking

Stuff that's out there in the way out and beyond in banking.

See all

Now hiring