Insurance ruling adds to banks' PR woes

Banks have been advised to refocus their PR operations following the recent High Court ruling on payment protection insurance that looks set to further damage the banking industry's reputation.

Barclays is among the banks hit by the ruling
Barclays is among the banks hit by the ruling

On 20 April, UK banks lost a judicial review that could have a major impact on whether more compensation has to be paid on mis-sold loan insurance. Banks will now have to look back at past sales of payment protection insurance (PPI), even if consumers have not complained. Some estimates have said this could lead to a £4.5bn bill for the banks.

The British Bankers' Association (BBA) said it was 'disappointed' by the ruling. Corporate PR professionals said the ruling could prove to be damaging to banks' reputations as well as their balances.

Edelman director of corporate and financial Grant Clellan said: 'Thanks to the credit crisis, banks are extremely unpopular, and a perception that they are trying to protect their own profits at the expense of individuals who believe they were mis-sold PPI is the last thing they need right now.'

Pagefield partner Sara Price added: 'Before the process can truly begin, the banks need to re-establish their right to be heard. The journey back starts with listening.

'By providing an anonymous institution with a human face, banks can begin to rebuild their credibility and can then earn the right to move on.'

Kreab Gavin Anderson CEO Richard Constant advised: 'The banks can't win the hearts and minds of customers by insisting that they are right in law while ignoring the ethical and simple fairness test.

'They need to refocus on helping customers understand the financial system. The small print culture should be stripped out of the business model.'

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus

Latest Articles

Labour "fooling themselves" over plans to combat attacks on Miliband

Labour "fooling themselves" over plans to combat attacks on Miliband

Conservative-leaning public affairs experts have questioned the value of Labour's adoption of US-style campaigning tactics in the wake of the opposition hiring election strategist David Axelrod.

PLMR appoints Professor Tim Morris as non-executive director

The vet who helped establish the British Horseracing Authority's anti-doping and animal welfare programme has joined PLMR as a non-executive director.