Corporate identity and private banking: A review and case study (CORPORATE IDENTITY, CORPORATE IDENTITY MANAGEMENT, PRIVATE BANKING, CORPORATE IDENTITY IN FINANCIAL SERVICES) INTERNATIONAL JOURNAL OF BANK MARKETING

Abstract

Provides an introduction to corporate identity management; gives an overview of the private banking sector both in the UK and overseas and, using a case study focusing on the private bankers Adam and Co., describes the elements forming that bank’s corporate identity. These elements were history; key incidents; and service quality. The latter was found to be the most likely contributor to that bank’s identity. Argues that bank managers, in addition to asking the questions What is our business?, and what is our image? , should ask, What is our identity?

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International Journal of Bank Marketing
Corporate identity and private banking: a review and case study
John M.T. Balmer Snorre Stotvig
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John M.T. Balmer Snorre Stotvig, (1997),"Corporate identity and private banking: a review and case study", International
Journal of Bank Marketing, Vol. 15 Iss 5 pp. 169 - 184
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[ 169 ]
International Journal of
Bank Marketing
15/5 [1997] 169–184
© MCB University Press
[ISSN 0265-2323]
Corporate identity and private banking: a review and
case study
John M.T. Balmer
Department of Marketing, University of Strathclyde Business School, Glasgow, UK
Snorre Stotvig
Department of Marketing, University of Strathclyde Business School, Glasgow, UK
Provides an introduction to
corporate identity manage-
ment; gives an overview of the
private banking sector both in
the UK and overseas and,
using a case study focusing
on the private bankers Adam
and Co., describes the ele-
ments forming that bank’s
corporate identity. These
elements were history; key
incidents; and service quality.
The latter was found to be the
most likely contributor to that
bank’s identity. Argues that
bank managers, in addition to
asking the questions What is
our business?, and what is
our image? , should ask,
What is our identity?
. Introduction
In 1985 Edmund Gray and Larry Smeltzer,
writing in The Sloan Management Review,
argued that senior managers in addition to
answering Peter Drucker’s question “What is
our business?” also need to address an
equally pertinent question, namely, “What is
our image?”. Twelve years on, both managers
and academics are starting to realize that
another crucially important question needs
to be answered by organizations: “What is
our identity?” These questions take on a
particular urgency within financial services
where most institutions lack “a special iden-
tity”. Indeed, Meidan (1996) identifies the
“lack of special identity” as the fourth of ten
characteristics of financial services institu-
tions. Clearly, there is a link between all three
questions. In explaining the links between
strategy and image Gray and Smeltzer (1985,
p. 73) explained that:
Strategy is the overall plan that relates the
corporation to the environment. The envi-
ronment in turn, is composed of constituent
groups or publics. Corporate image is the
impression of the overall corporation held
by these various publics. The image that
each public has of the corporation deter-
mines, to a large degree, the success of the
strategy vis-à-vis that group. Hence for a
strategy to be effective, it must be compre-
hended accurately by the target publics.
Moreover, the image conveyed must be
positive. A weak or negative image per-
ceived by any of the company’s publics
indicates either an inappropriate strategy
or a failure to communicate that strategy
effectively. In either case it is essential that
corporate image be considered when plan-
ning strategy.
In this paper the authors argue that acquir-
ing a favourable image requires managers
first to understand and second to manage the
organization’s corporate identity. In other
words, corporate identity provides the bridge
which links strategy with image and reputa-
tion.
In financial services, it has been argued
that the most effective type of differentiation
is the acquisition of a strong corporate image
(Balmer and Wilkinson, 1991; Morello, 1986;
Richardson and Robinson,1986; Stewart, 1991;
Van Heerden and Puth, 1995; Wilkinson and
Balmer, 1996). However, financial institutions
have, for many years, attempted to differenti-
ate their organizations from their competi-
tors through a wide variety of means. In the
main they have failed. Innovation and price
advantage were found to give financial ser-
vices only a temporary advantage and a
reliance on marketing communications and,
in particular on advertising, only reinforced
how similar financial institutions were.
Whereas many managers and academics
argue that acquiring a distinct and positive
image is a desirable strategic objective,
achieving this objective is fraught with diffi-
culties. Howcroft and Lavis (1986) remarked
that corporate image is “sticky and difficult
to dispel or change” and that the manner in
which this is done is complex. The process of
changing, or creating, a company image and
reputation is complex and entails a concern
with, and the management of, an organiza-
tion’s corporate identity or, what marketers
sometimes prefer to call the corporate brand
(King, 1991). As Baker and Balmer (1997)
noted “There needs to be a realization that
applying the principles of marketing to corpo-
rate brands, as opposed to a classic product
brands, is an inherently more complicated
and challenging affair.” The next section
examines the concept of corporate identity.
Corporate identity: what is it?
For many years writers equated corporate
identity with organizational nomenclature,
company house style and visual identity. A
recent example is Dowling (1994, p. 8) who
stated that corporate identity refers to “the
symbols an organisation used to identify
itself with people”. However, this is not to say
that visual identity is not powerful (see Baker
and Balmer, 1997). More recently, a consensus
has started to emerge among academics in
defining the nature of corporate identity.
Corporate identity is now seen to refer to the
distinct attributes of an organization, i.e.
“What it is” (Balmer, 1995). The distinguish-
ing features of corporate identity may be
described as follows.
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[ 170 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
First, corporate identity is concerned with
reality, and encompasses corporate strategy,
philosophy, history, business scope, the range
and type of products and services offered
(Balmer, 1995; Moingeon and Ramanantsoa,
1997; Schmidt, 1995). Second, corporate iden-
tity is multi-faceted and draws on several
disciplines (Balmer, 1995; Schmidt, 1995; Van
Riel and Balmer, 1997). Third, corporate iden-
tity is based on the corporate personality, in
other words, the values held by staff within
the organization (Balmer, 1995; Hatch and
Schultz, 1997; Olins, 1978).
Managing and evaluating an organization’s
identity is complicated. It involves:
• understanding the company’s philosophy,
personality, identity, image and reputation;
• examining key internal-external-environ-
ment interfaces for signs of inconsistency
and incompatibility;
• ongoing management by senior manage-
ment, with the chief executive taking a
particular interest.
The results of such analysis can result in a
plethora of change processes which may
include one or more of the following:
• major repositioning of the organization;
• the nurturing of a new corporate personal-
ity (mix of internal value systems within
the organization);
• altering the organizational branding
structure;
• improving the organization’s corporate
communications and visual identity.
The objective of corporate identity
management
The main objective of corporate identity
management is to ensure that an organiza-
tion’s key stakeholders and stakeholder
groups are favourably disposed towards the
organization. As such, it is presumed that
such groups are predisposed to use the orga-
nization’s products and services (retail cus-
tomers), to trade with the organization
(industrial customers), to purchase stock in
the company (stockholders), to work for the
company (employees), to provide a sympa-
thetic legal framework (government), and to
speak well of the organization (the media and
local communities). By the above means an
organization can achieve a competitive
advantage which ultimately contributes to
the bottom line and to business survival. In
order to understand the basic principles of
corporate identity management an under-
standing the main concepts in use is likely to
be helpful.
Corporate personality
This refers to the distinct mix of ideologies
present within the organization. These
ideologies are revealed through the value
systems and through behaviours of person-
nel. A number of authors argue that the cor-
porate personality is at the heart of corporate
identity formation (Balmer, 1995; Olins, 1978;
Van Rekom et al., 1993).
Corporate identity
At a very simple level this refers to, “what an
organization is” (Balmer, 1995), or explained
slightly differently, it may also be seen to
refer to an organization’s distinct character-
istics. Albert and Whetton (1985) state that an
organization’s identity should be central,
distinctive and enduring. An identity is expe-
rienced through everything an organization
says, makes or does. The elements compris-
ing the corporate identity mix have been
variously described as strategy, culture and
communications (Balmer 1995), symbolism,
behaviour and communication and culture,
behaviour, market, communication design,
products and services (Schmidt, 1995).
Corporate image
This refers to the impressions held of an
organization by an individual or a group. In
the marketing literature it normally refers to
the experiences, impressions, beliefs, feelings
and knowledge that people have about a com-
pany (Bevis in Bernstein, 1986, p. 125).
Corporate reputation
This indicates the attributes ascribed to an
organization which is inferred from its past
actions (Weigelt and Camerer, 1988, p. 1). A
reputation, unlike image, develops over time
and is the result of knowledge and/or experi-
ences held of an organization.
In addition to understanding some of the
main concepts in use the impact of the socio-
economic, demographic, political and techno-
logical environment must be taken into
account.
The external environment
While the acquisition of a favourable corpo-
rate reputation is a desirable strategic objec-
tive it should not be seen as an end in itself
since a good reputation is not necessarily
sufficient on its own to ensure an organiza-
tion’s success and survival. Companies and
industries with good reputations may go out
of business: an example in financial services
is terminating building societies (Balmer and
Wilkinson, 1991). The acquisition of a
favourable and enduring identity is more
likely to occur when account is taken of the
external environment.
Operationalizing corporate identity
The following section briefly articulates
recent attempts to operationalize the basic
tenets of corporate identity.
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[ 171 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
A conceptual model
Integrating the various elements of the corpo-
rate identity management process can be a
complicated affair. Figure 1 shows several
interfaces which need to be considered when
evaluating the effectiveness of an organiza-
tion’s identity. The idea of “corporate identity
interfaces” builds on the work of Abratt
(1989), who outlined the importance of the
corporate identity/corporate image inter-
face, and Stuart (1994), who stated that this
interface represented a “moment of truth” for
organizations.
The Strathclyde Statement
One initiative taken up by academics and
consultants has been the penning of a state-
ment on corporate identity which aims to
explain the elements involved in, as well as the
possible benefits of, corporate identity man-
agement. Appendix 1 reproduces the so-called
“Strathclyde Statement” drawn up by some of
the leading members of the International
Corporate Identity Group (ICIG), an organiza-
tion which has the objective of furthering
greater understanding of corporate identity as
a strategically led management concern.
Now that a brief overview of corporate iden-
tity has been provided, the next section exam-
ines the second theme with which this paper
is concerned – private banking.
Private banking explained
Strictly speaking, private banking refers to
those banks which are owned by a group of
partners who between them have unlimited
liability. Originally, the Bank of England oper-
ated under this arrangement. Today, there is
only one UK bank of this type where the part-
ners have unlimited liability. This is the fam-
ily-owned Messrs Hoare and Co. A number of
overseas banks also have unlimited liability
including the US bankers Brown Brothers
Harriman (founded in 1882) and the Banques
Privées in Switzerland such as Picted and Cie
Lobard, and Odier and Cie of Geneva.
The origins of the private banking sector in
the UK can be traced back to London Gold-
smiths who, in the seventeenth century, were
described as “Goldsmiths keeping Running
Cashes” in other words, giving negotiable
receipts in exchange for plate and other valu-
ables (Hilton-Price, 1876 pp. 158-9). By the
Figure 1
The basic tenets, disciplines and objectives involved in corporate identity management
Corporate mission
and ethos
Management vision
Strategic planning
Organizational
history
Corporate branding
Underpinned by the
corporate personality
(mix of cultures in
the organization)
The nurturing of sub-
cultures which
support the mission
and ethos
Organizational
behaviour
Psychology
Ethnography
Reflected in the
corporate identity
(what the
organization is –
values of personnel,
product/services,
formal and informal
communications,
corporate behaviour)
Effective
management of
corporate identity
and corporate
communications
Marketing
Human resources
Total quality
management
Internal
communications
Graphic design
Translation (at any
one point in time)
into a corporate
image
Monitoring of
perceptions among
key stakeholders
Image studies
Public relations
Formal corporate
communications
Knowledge and
experience of
distinct
organizational
attributes over time
forms corporate
reputation
Monitoring of
reputations among
key stakeholders
Reputation studies
Public relations
Formal corporate
communications
Effect: profitability
and survival
i.e. a predisposition
by stakeholders (or
not) to buy the
organization’s
products/services,
to invest in, trade
with or work for the
company, etc.
Acid test of
corporate identity
management
vis-á-
vis
the
appropriateness of
corporate mission
and ethos as
translated in the
corporate identity/
bottom line
Finance
Market research
Psychology
Feedback
Influenced by environmental forces
Identity environment
interface
Identity image
Identity reputation
Reputation
environment interface
Evaluate
interface
interface
Source: Balmer
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[ 172 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
early eighteenth century some of these banks
had opened ledgers which were entirely
devoted to banking: a case in point being
Drummond Bankers who began operating as
a private bank in September 1717 (Bolitho and
Peel, 1985). A little further on, private banks
targeted two distinct groups within London.
In the City, bankers such as Glyn Mills served
the banking requirements of merchants and
manufacturers whereas in the West End,
bankers, such as Child & Co and Drummonds,
served the aristocracy and gentry. During the
last century there were over 4,000 private
banks operating in Britain.
Within the UK there still exists a small
collection of famous, and historic, private
bank marques. Examples include Child and
Co., Coutts, Drummonds and Messrs Hoare
and Co. Traditionally, their main customers
have come from the aristocracy, the landed
gentry and from venerable British institu-
tions. For instance, Child and Co.’s clients
include the University of Oxford, the Inns of
Court and many legal firms. Then there are
Royal Bankers – the most famous being
Coutts but less well known is Drummonds
which is patronized by HM the Queen Mother.
The private bankers par excellence is Messrs
Hoare: they are the most discreet of all the
British private banks and their partners have
unlimited liability; they are unique in this
regard. Mention can be made of Harrods
Bank. Although it shares the name of Lon-
don’s most famous departmental store it is
now an independent entity and its customer
base draws heavily on those who shop at
Harrods – this includes a sizeable percentage
of North American customers.
However, a bank’s reputation for exclusiv-
ity and security may have its drawbacks. This
recently happened to Rothschilds. The bank’s
market research revealed that the bank’s
efforts with regard to new product innovation
was not recognized and it embarked on a
process of trying to change the perception of
prospective and current customers (Cohen,
1991).
For some while now, the label private bank-
ing has been used as an umbrella title for
bespoke banking services which meet the
needs of the rich, or to use private banking
parlance, “high net worth individuals” (HIN-
WIs). Private banks rarely use the word cus-
tomer, the preferred nomenclature is client.
An indication of who is classified as an
HINWI can be gleaned from 1995 figures
which showed that an individual is required
to have a minimum asset of £250,000 to open
an account with Barclays, £15,000 at Coutts,
£75,000 at Lloyds Private Bank and £100,000 at
Midland Private Bank (Simpson, 1995). The
rush by many banks to seize the title private
for some part of their banking service, or
attach it to one of their brands is nothing
more than a conceit according to Wood (1989,
p. 6) who remarked that “there is little private
about these banks”.
The growth of private banking
Private banking has been described as “the
hottest and fastest growing banking sector”.
In a special survey on private banking
appearing in The Economist (1994) it was
stated that, “many bankers see private banks
as an engine of growth in an otherwise slug-
gish market”. The big banks have realized
that meeting the needs of HINWIs produces
handsome profits and does not carry any of
the risks associated with their past enthusi-
asms such as Third World Debt, or lending to
the property sector at the height of a boom
(Hamilton, 1993). For the last 15 years the
private banking sector has experienced
annual growth of around 15 per cent (Kay,
1994). All the main British high street banks
now have private banking arms.
A number of strong images of private bank-
ing are often associated with country of ori-
gin of private banks. Swiss private banks, and
their customers, are often surrounded by
intrigue and secrecy. The image of British
private banks is still influenced by those
banks who adhere to certain banking prac-
tices and social norms of eighteenth century
polite society. Such banks are believed to
cater for the needs of the aristocracy and “the
establishment”. Thus, tradition, civility, and
discretion are still the order of the day. This is
in contrast to the no-nonsense, North Ameri-
can, private bankers. In contrast to British
private banks they are viewed as catering for
the nouveaux riches: businessmen and
women, media personalities and the like. For
a review of recent developments in North
America see Blume et al. (1991).
The above stereotypes of private banking
are no more than that. In reality the sector is
highly developed and there are a wide range
of private banking services and styles on
offer. While other parts of the financial ser-
vices industry have suffered bad debt, have
fallen in the estimation of the public and have
become increasingly impersonal, the private
banking sector has grown and flourished. As
one former local director of England’s oldest
private bankers, Child and Co., remarked,
“the more impersonal other banks become,
the greater this business will grow” (Hanson,
1994).
It would appear that senior managers
within the sector have by design, or by
chance, begun to marshal the principles of
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[ 173 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
strategic corporate identity management
(Balmer, 1995), coupled with some of the basic
tenets of marketing, in order to position their
private banks in the market and in the minds
of their key stakeholder groups; and to secure
mutually beneficial relationships with such
groups.
The phenomenal growth of private banking
is due to the realization by the major high
street retail banks that the very wealthy pro-
vide an untapped, profitable, and growing
sector of the market. There are no less than a
million people with liquid assets of more than
£50,000 in the UK (Griffiths, 1994); the USA
has in excess of a million individuals with
liquid assets of more than $1 million (Wood,
1989, p. 7) and worldwide the wealthy have
liquid assets of $9.6 trillion.
In the UK, the size of the sector is
illustrated by 1994 figures which showed that
there were 38 banks offering private banking
services with Coutts Bankers managing
deposits of £6bn, Lloyds Private Banking
£4.3bn, Hill Samuel Private Client Manage-
ment £2.3bn and, at the other end of the scale,
Adam and Co. with £150m (Kay, 1994). Recent
figures show that the sector has total deposits
of £50 billion and that the UK has a market
potential of approximately £186 billion (Mei-
dan, 1996, p. 27).
Internationally, mention can briefly be
made of a number of distinct private banking
centres including The Cayman Islands, the
Channel Islands, London, Luxembourg,
Miami, New York and Geneva. Well over half
of the world’s private banking business is
centred in Europe with Switzerland taking 35
per cent of the market, followed by London
with 15 per cent and the Channel Islands and
Luxembourg with 6 per cent. Typically, cen-
tres of private banking tend to be based in
nations having a stable economic and politi-
cal system. There are other considerations.
Swiss private bankers, for instance, have a
reputation for stability and secrecy. London
has a number of advantages; it is one of the
world’s three main financial centres and has
access to an impressive range of treasury
products offered by the British Government.
On closer examination of the literature
private banking customers within the UK and
elsewhere can be segmented in at least six
different ways: see Balmer’s categorization in
Appendix 2.
Corporate branding in private
banking
An examination of the private banking sec-
tor in the UK reveals there to be different
types of corporate branding structures
which variously give emphasis to the corpo-
rate brand of the parent, to that of a sub-
sidiary or to a service brand. In this sense
examples can be found of the three
categories of visual identity identified by
Olins (1978) who remarked that organiza-
tions have three choices with regard to par-
ent visibility: monolithic (using only the
corporate name), for example Lloyds Private
Bankers; endorsed (a brand which makes
reference to the corporate name), for exam-
ple Hill Samuel – part of the Hong Kong and
Shanghai Banking Corporation (HSBC) and,
finally, the branded approach (where no
reference is made to the corporate name),
for example Coutts – owned by National
Westminster Banking Group. However, the
above categorization does not adequately
reveal all the types of relationship between
the parent organization and its private bank-
ing operations and therefore reference will
be made to Kammerer’s (1988) categorization
(see Figure 2)
The following section details the various
types of generic private banking identities
within the UK.
Categories of generic private bank
identities: arrivistes and
traditionalists
Traditional private banks
Following the strict definition of private
banking (the partners having unlimited lia-
bility) there is only one private bank in
Britain: Messrs Hoare and Co. The bank was
founded in 1772 and is still owned by the same
family.
Ownership of historic private banking
brands by financial institutions
This category refers to those private banks
which have been acquired by one of the high
street retail banks and who, to some degree,
have kept something of the identity of the
original institution. However, within this
category the relationships between the parent
company and the brand or brands of its pri-
vate banking operations vary considerably.
The most famous private banker is The
Royal Banker’s Coutts and Co., whose origins
go back to 1692. It has been part of the British
National Westminster Bank Group since 1920.
In addition to having its own visual identity
which operates more or less as a brand (fol-
lowing Olins categorization, 1978) it also
keeps its distinctiveness by maintaining its
own recruitment and career structure. Such a
system enables a distinct set of values and a
distinct corporate ethos to be maintained.
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[ 174 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
Private financial services offered by the
retail banks
This group embraces the majority of private
banks who share a common corporate brand
name with its parent and invariably there is a
closer manager relationship. In many cases
these banks have targeted their HINWIs and
have offered them distinct banking services.
An example is Lloyds Private Bankers.
Private financial service offered by
investment banks
The lucrative nature of private banking has
been identified by investment bankers who
have entered the market. Examples include
Kleinwort Benson Private Bank, Hambros
Bank, and Flemings Private Bank.
Promoting private banking
There are distinct differences in the manner
that the newer private banks and the more
traditional attract new customers. The older
private banks such as Hoare and Co. and
Childs rely heavily on word of mouth, as well
as on personal introduction by other clients
in addition to solicitors and accountants in
attracting clients. For the main, advertising
is shunned by the more traditional private
banks. As one director of Child and Co.
remarked, “The more you advertise yourself,
the less your customers like it” (Barchard,
1990).
In recent years Child and Co. have
embarked on one or two discreet advertising
campaigns. Figure 3 reproduces an advertise-
ment which appeared in Investors Chronicle
in 1994. This understatement, or, to use mar-
keting parlance, demarketing, has served the
traditional private banks rather well. For
instance, The Economist, in its survey on
private banking in 1990, gave the example of
the private bankers Messrs Hoare and con-
cluded that there is merit in such understate-
ments. “The Hoares will still be around when
yuppies are no more than a lexicographical
curiosity.”
The newer entrants to the sector do adver-
tise in upmarket publications such as Forbes
or Town and Country. Newer entrants also
engage in other promotional activities. Chase
organizes private seminars in conjunction
with Sothebys with such titles as “Investing
in art”. US Trust also arranges seminars. One
of these seminars included a talk by the chief
gemologist from Tiffany. US Trust has also, in
the past, employed an investment
professional to travel back and forth on the
Queen Elizabeth II on the Southampton –
New York route giving lectures on managing
savings (Cohen, 1991).
Private banking in the Royal Bank
of Scotland
Of all the major retail bankers in Britain the
Royal Bank of Scotland (RBS) has the greatest
number of private bank marques. Before
looking at the case study which examines the
changes of identity within Adam and Co. a
brief description will be given of the RBS’s
three other private bank marques: Child and
Co., Drummond’s and Holt’s.
Figure 2
Kammerer’s classification of corporate identities (1988)
Subsidiary has
own identity
Finance-
oriented corporate
identity
Subsidiary has own
identity
Organization-
oriented corporate
identity
Identity of subsidiary
ascribed to parent
organization
Communication-
oriented corporate
identity
Subsidiary as part
of identity of parent
organization
More differentiated
types, see brand
policy
Parent organization not
identifiable in market Parent organization
identifiable in market
Financial
participation only Business participation
Parent organization
Diversified corporate identity Single firm
identity
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[ 175 ]
The Royal Bank of Scotland (RBS) has a
somewhat complicated policy with regard to
its private banking operations. During the
early part of the twentieth century the bank
acquired several famous, historic banks such
as Child & Co., Messrs Drummond’s and
Holt’s. More recently the bank has acquired
Adam and Co. (this will be dealt with in the
second part of this paper). The RBS’s relation-
ships with its four private brands have gone
through several changes from a position
where, with the exception of Adam and Co.,
the three other brands were considered as
nothing more than branches of the RBS, to
the recent position where Child and Co. has
acquired a distinct corporate identity (Figure
3). Drummond and Co., which operates as a
quasi private bank, is regarded as a special
branch of the Royal Bank of Scotland and has
a special visual identity. On the other hand,
Holts is nothing more than a branch of the
RBS even although it maintains a distinct
visual identity.
A brief description of Child and Co, Drum-
monds and Holts follows.
Child & Co., bankers
This is England’s oldest bank, whose roots
can be traced back to the late sixteenth cen-
tury. It used to boast that, like the Bank of
England it was the “banker’s bank” because
customers included members of the Baring,
Hambro and Rothschild families (Hanson,
1994). Child and Co. has served as bankers to
some of the most eminent figures in British
life and its clients have, traditionally, been
drawn from the nobility, the landed classes, a
number of Oxford colleges, the Inns of Court
and the legal profession. Although the bank
no longer enjoys a high profile (and probably
does not wish to) this was not always the case.
In the nineteenth century Charles Dickens is
believed to have based his description of Tell-
son’s Bank in his book A Tale of Two Cities on
his experiences at Child & Co. “Tellson’s
Bank by Temple Bar was an old-fashioned
place. It was very small, very dark, very ugly,
very incommodious... a miserable little shop,
with two little counters, where the oldest of
men made your cheque shake as if the wind
rustled it.”
In 1924 the bank was sold to Glyn Mills and
Co. and in 1939 Childs was acquired by the
Royal Bank of Scotland. In the 1960s the bank
continued to flourish and it received a fillip
from the merger of Martins Bank with Bar-
clays; this saw a number of clients from Mar-
tins Bank moving their accounts to Child’s.
The competition from the personal banking
sector in the 1980s spurred the bank’s man-
agers to further emphasize the bank’s her-
itage. The bank’s office at No.1 Fleet Street
was renovated and a new visual identity was
introduced based on the bank’s historic trade
sign of the marigold. This is one of the oldest
trade signs in use and has been associated
with the bank since 1640. Whereas the former
visual identity more or less treated Child and
Co. as a branch of the RBS the new visual
identity adopts a fully branded approach and
only mentions the RBS in small print in order
to comply with legal requirements. At around
this time the bank’s branch in Oxford was
closed. As part of the process of positioning
the bank within the private banking system,
the bank’s managers in 1992 amended the
terms of the private banking tariff. This was
to ensure that only HINWIs or those willing
to pay a monthly fee of £25 for balances less
than £1,500 would remain customers of the
bank. Up until this point the bank offered a
Figure 3
An example of the discreet advertising undertaken by Child & Co.
We’ve been the very souls of discretion
for over 400 years. Indeed our values
have changed little since Nell Gwynne’s
day. We still know all our clients by
their names, not account numbers. We
offer them the services of a private
client manager to look after their
banking arrangements on a day to day
basis. And to be on hand to offer any
advice on affairs. Financial affairs,
naturally. You can call Stephen Venables
in confidence on 071-353 9865
AT LEAST SHE COULD
DEPEND ON HER FINANCIAL
AFFAIRS BEING DISCREET.
NELL GWYNNE
THE ROYAL BANK OF SCOTLAND plc INCORPORATING CHILD & CO., BANKERS.
1 FLEET STREET, LONDON EC4Y 1BD. THE ROYAL BANK OF SCOTLAND plc
IS REGISTERED IN SCOTLAND NO. 90312 REGISTERED OFFICE:
36 ST ANDREW SQUARE EDINBURGH EH2 2YB
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
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[ 176 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
“free in credit” tariff in common with other
RBS branches. Since 1992 the bank has, in
effect, adopted a demarketing policy. Opening
an account is difficult and it is not uncom-
mon for applications to open an account with
the bank to be declined on their first applica-
tion. The bank’s exclusivity is enforced by its
advertising and sponsorship which is best
described as discreet.
Messrs Drummond’s, bankers
Messrs Drummond’s of 49 Charing Cross is
one of the oldest banking houses in London
having been established in 1717 by the
Scot, Andrew Drummond. The bank was
acquired by the RBS in 1924 and, until com-
paratively recently, was treated as little more
than a branch of the bank. However, in the
1990s RBS realized the potential of the Drum-
mond’s brand: a high percentage of HINWIs
used the bank (HM, The Queen Mother is a
customer). This began the process of posi-
tioning Drummond’s as a private bank
brand. The bank adopted a policy of seg-
menting its customers and tailoring its pri-
vate banking services to meeting the needs
of these various segments. This was in con-
trast to the policy at Childs where the policy
was to lose non-HINWIs or to ask new HIN-
WIs to pay high banking charges. As part of
this process the bank adopted a new visual
identity and house style for its cheque books,
literature and signage. This distanced itself
visually from its parent the RBS. In addition,
the bank’s prestigious premises next to The
Mall was refurbished and decorated. The
following quote from the bank’s literature
illustrates how the bank attempted to draw
on its heritage. “The refurbished offices
were designed to reflect the splendour of
Drummond’s continuing heritage as bankers
to persons and institutions of distinction”
(1993 RBS Archives).
Holt’s
Brief mention is made of Holt’s which,
although it has a distinct tradition in private
banking, was not subject to the repositioning
exercises undergone by Child’s and Drum-
mond’s. Holt’s was founded by William Kirk-
land in 1809 with the objective of offering
banking services to the British Army. To this
end the bank opened up branches in White-
hall and in Aldershot. The Whitehall branch
was closed at the time of the repositioning of
Drummond’s bank in the 1990s (the Holt’s
branch was very near to Drummond’s). At
present, Holt’s remains little more than a
branch of the RBS but does keep something of
a distinct visual style. However, as with the
case of Drummond’s and Child’s it does have
the potential to be relaunched as a distinct
private bank as indeed do other private bank
marques such as “Martins” (owned by Bar-
clays Bank).
See Figure 4 which shows examples of the
visual identities of Child and Co., and Drum-
mond’s and Holt’s.
Having given a brief overview of the private
banking sector and provided an explanation
of corporate identity management this paper
goes on to integrate these two strands in a
case study focusing on the Edinburgh based
private bankers Adam & Company. The objec-
tives of the case study are
• to explain how Adam and Company as a
new entrant to private banking was able to
position itself so clearly in the sector in
such a short space of time;
• to identify those parts of the corporate bank
such as Adam and Co; and
• to provide guidelines for the bank’s parent
(The Royal Bank of Scotland) in managing
the Adam and Co.’s identity.
Figure 4
Visual identities of Child & Co., Drummond and
Holt’s
(a)
Child & Co Bankers
(c)
Holts
(b)
Messrs Drummond Bankers
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[ 177 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
The case study: Adam and
Company
This case examines the findings of research
conducted in Adam and Company using
the case study approach. Prior to the
research being carried out, Adam and Co.
had been acquired by the Royal Bank of
Scotland, a large retail bank with diversi-
fied interests.
The private bankers Adam and Co. was
formed in 1983 by Sir Ian Noble and another
partner. Adam and Co. is, in every sense, a
new private bank. The bank is named after
the famous Scottish economist Adam Smith.
Through this means the bank aimed to capi-
talize on the Scots’ reputation for being finan-
cially astute and conservative. Adam and Co.
originally operated from one branch in Edin-
burgh and was surrounded by law and
accountancy firms. Many of these companies
became the bank’s clients. Adam and Co.
comprises three business units, namely the
Adam Bank, Adam and Company Investment
Management Ltd and Adam & Company
International Ltd. The latter is based in
Guernsey. A total of 120 employees are
employed in its branch network, and most are
concerned with investment management.
Adam and Co. is a small bank, and this has
been one of its strengths.
The Royal Bank of Scotland take-over
The early 1990s proved to be a difficult period
for Adam and Co. In August 1992, it was dis-
covered that Adam Bank had incurred an
exceptional loss of £21m through unautho-
rized currency trading operations by its Lon-
don treasury dealing department. Operating
income for the year to 30 June 1992 was £7.6m,
and operating profit before the exceptional
unauthorized currency trading loss was
£1.52m. In the summer of 1993, Adam & Co.
was acquired by the Royal Bank of Scotland
Group for £10.5m.
The take-over was consistent with the Royal
Bank’s strategy for the development of its
domestic private banking businesses and it
fulfilled the Royal Bank’s objective of provid-
ing private banking services in Scotland. The
Royal Bank decided to operate Adam & Com-
pany as an autonomous company, capitalizing
on the identity and reputation of Adam and
Company. Adam and Company kept a sepa-
rate authorization for Bank of England pur-
poses. It was also the intention of the Royal
Bank that existing banking and other
arrangements with Adam’s customers should
remain in place.
Methodology
A literature review confirmed that there had
been little research which examined the role
of corporate identity in private banking. The
size, and growth, of private banking and the
recent surge of interest in corporate identity
by managers and management scholars sug-
gested that this was a potentially important
area of study.
Adam & Company was deemed to be a topi-
cal case study because it is a new entrant in
an industry which is known for its traditional
and heritage-steeped competitors. It is Scot-
tish, while all the other UK private banks are
based in London. It is also relatively small.
Moreover, Adam & Company had just
recently been acquired by the Royal Bank of
Scotland. The combination of these elements
raised important questions about the identity
and image of the bank.
A case study approach was felt to be the
most appropriate methodological approach.
Gummesson (1991) argued that case studies
are able to offer a holistic view of a manage-
ment issue, and are most appropriate when
examining an eclectic area such as corporate
identity. A sample of respondents represent-
ing the top management at Adam & Company
were selected for interview. The interviews
were in depth and each interview lasted
approximately one hour. The topic guide dealt
with issues such as the perceptions and atti-
tudes to the take-over of Adams and Co. by the
RBS, and the elements which they believed
underpinned Adam and Co’s unique identity.
The transcribed versions of these interviews
were analysed following methods suggested
by Easterby-Smith et al. (1991), Glaser and
Strauss (1967) and Lowe (1992).
Findings
The major themes that emerged in the analy-
sis are presented in Figure 5. The three
themes which the respondents related to
corporate identity were:
1 Adam & Company’s history;
2 the incidents that it had been subject to
(including the Royal Bank take-over);
3 the quality of its service.
History
This finding refers to the effect that the his-
tory of Adam & Company had on its corporate
identity. This section could also be known as
“internal identity” or, what organizational
behaviourists call organizational identifica-
tion (Hatch and Schultz, 1997). This is
because the elements of Adam and Co’s “his-
tory” were also responsible for what one
respondent called “company culture”. This
respondent defined identity as “how employ-
ees identified themselves with the company”.
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[ 178 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
All the respondents felt that the bank’s his-
tory was responsible for Adam and Co’s iden-
tity and structure. The emphasis on history
was of added importance to the bank since it
was trying to establish an identity that was
very similar to other private banks. The issue
of tradition was one exception; although the
bank used visual cues to give customers an
impression of looking old-fashioned, one
respondent pointed out that “we want to look
traditional, but people are not interested in
history, but in technology”. The issue of flexi-
bility refers to the bank’s ability to use a
flexible approach in its service offering to
individual customers; and to its technological
efficiency. This bank’s size also allowed for
this flexibility.
Incidents (client satisfaction and
customer loyalty)
The data revealed that two incidents influ-
enced the image and identity of Adam & Com-
pany. These incidents had implications for
the positioning of the bank and its relation-
ship with clients. The two incidents were: the
Royal Bank of Scotland’s take-over in the
summer of 1993; and the unauthorized cur-
rency trading loss in August 1992. The take-
over by The Royal Bank has caused surprise
since many in the City thought that the bank
would not survive. According to one respon-
dent, the bank had speculated that it would
lose a third of its business after the take-over
by the RBS. Instead, there had been tremen-
dous support from clients. The reasons for
the positive outcomes that had followed the
two incidents were due to client satisfaction
and customer loyalty. Overall, this discussion
theme was particularly useful in explaining
the determination of Adam and Co. to main-
tain its existing identity. However, there was a
consensus that the Royal Bank would exert
its authority over the bank. As one respon-
dent put it, if “Big Brother take it over, it
mean the end of Adam’s identity”.
Service quality
Service was the most frequently mentioned
issue in all the interviews. One respondent
stated that “customer service is corporate
identity”. This may be contrasted with
visual identity which could be expressed
through expensive decor and beautiful build-
ings, but would be absolutely useless if the
service was not superb. Service quality
could be achieved through an array of meth-
ods, and they can be identified in the cate-
gories evident in Figure 5.
Figure 5
Model of three themes emerging from the analysis of interviews
Service quality
Awareness Consistency Personal
relationship Perception Visual
image
Responsibility Employee
training
Uncertainty Client
satisfaction Customer
loyalty Strength of
identity Word of
mouth
Surprise
Incidents
Royal bank
takeover Currency
trading loss
History
Client
selection
Flexibility1983 Tradition Scottish Size Location
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[ 179 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
The most influential characteristic of Adam
& Company’s identity is the quality of its
service, which is founded on the close rela-
tionships with customers. This personal
relationship leads to a familiarity with the
clients’ needs, which enables the account
managers to make rapid decisions, which
also increases efficiency. Consequently, every-
one at the bank is responsible for the corpo-
rate identity of the bank. The consistency of
service quality determined the bank’s image,
and this consistency was assured through
staff selection and training. One respondent
stated: “a person would not get the job done if
they did not fit in”. The respondents believed
that most of the customers had initially
joined the bank because of dismay with the
retail banks. The strength of the bank lay in
its personal relationships with clients.
Although each theme includes factors that
are responsible for the creation of Adam’s
identity, the bank’s distinctive quality of
service was the most influential contributor
in creating a distinct identity (see the theme
“service quality”). Within the theme service
quality, the ability to create and maintain
“personal relationships” with clients was felt
to be one of the most valuable assets of Adam
& Company. The respondents concluded that
if this asset was lost, all of the bank’s other
components of the identity would be useless.
Implications and discussion
This case study revealed the crucial role
corporate identity plays in positioning a
service company such as a private bank in
its market. The case study showed that
Adam & Company’s identity was influenced
by various factors including company size,
history, change in ownership and the quality
of employees. The study clearly suggests that
an identity is formed by actions and events.
Figure 6 shows a conceptual model of the
main factors which underpin Adam and
Co.’s identity and which would appear to
apply to many other private bankers: bank-
ing activities; customer perceptions; and
behaviour of employees. Each will be dis-
cussed briefly.
Banking activities
This refers to the financial products a bank
offers. On the whole, they are standardized
and difficult to differentiate. The elements
included in this category include interest
rates for savers and borrowers, the range of
current and savings accounts on offer, mort-
gages, insurance, and investment advice and
investment products. Private banking offers
many of the above. Naturally, there is an
emphasis on investment products. Some
older banks, such as Child & Co, offer added
value items such as sherry in the banking
hall and the occasional invitation to join the
manager for lunch. Even lunch is different
in that the traditions of the eighteenth cen-
tury are observed: not only is there a butler
in attendance but the main course is eaten
with two, three pronged, forks rather than
the traditional knife and fork!
Customer perceptions
Customers have certain expectations of the
service and style of a private bank. (There
are likely to be certain differences of expec-
tation depending on the country of origin of
the bank as discussed earlier on in the arti-
cle.) While these expectations will differenti-
ate private banks from retail banks they may
not be sufficient to differentiate one private
bank from another.
Consequently, banks use architectural
style (Coutts: its ultra modern bank interior
branch at Charing Cross), decor and furnish-
ings (Messrs Hoare: old world charm), loca-
tion and address (Child & Co: impressive,
historic building and address at 1 Fleet
Street, London) and, uniform (frock coats at
Coutts & Co). More noticeable is the visual
identity used by private banks. Several pri-
vate banks are the owners of some of the
oldest and most famous logos in use (Child
and Co, Coutts and Co., Messrs Hoare). All of
the above help to distinguish private banks
in the minds of customers. As an indication
of the above, the following is a description of
the interior of the Mayfair Branch of Lloyds
Private Bank given by Kay (1994).
Passing through the hall, you enter an
elegant room decorated in muted shades of
green. Oriental rugs are scattered on the
opulent eau-de-Nil carpet, a grandfather
clock ticks quietly in one corner, and a few
Figure 6
Conceptual model of integrated role of corpo-
rate identity in private banking
Banking
activities
Total
service
quality
Identity Behaviour of
employees
Customer
perceptions
Visual
images Internal
structure
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[ 180 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
copies of Country Life lie in careful disar-
ray on the little mahogany coffee table. A
discreet video camera and curved wooden
counter are the sole outward signs that this
is a place where money changes hands.
Behaviour of personnel
While the above two categories are important
the authors hypothesize that it is through the
behaviour of personnel that a private bank,
such as Adam and Co., achieves real distinc-
tiveness. This is the USP (unique selling
proposition) of private banks. In particular,
the role of account managers is of fundamen-
tal importance since they are in frequent
contact with clients. They are in every sense
the face and voice of the bank. Most
customers in private banks are assigned a
named account manager. In effect, account
managers are the most effective way of com-
municating the bank’s identity. Thus, it is of
fundamental importance that account man-
agers have the skills, experience and person-
alities to meet the expectations of clients.
Private banks, can, of course, segment the
market through matching account managers
with various categories of customer (Follow-
ers of fashion, Social aspirants, Blue bloods
etc., see Appendix 2).
Total service quality
This is an area where there is likely to be a
fusion of the banking activities, external
perceptions and behaviour of employees.
Total service quality is a combination of
functional quality and technical quality. For
instance, it would be a waste of resources to
have an excellent relationship with clients if
other aspects of the banking services were
inferior. So, for a private bank service quality
is a key determinant of its identity. Michael
Maslinski, head of business development at
Coutts & Co. remarked that Coutts’ unique
selling proposition is based on the fact that
“We are well established players in an old
business, and with a culture of service which
can’t be replicated overnight by other organi-
zations” (Griffiths, 1994). Total service qual-
ity was also a feature of one of the newer
private banks. James Cooper, the chief execu-
tive of Lloyds Private Bank noted that, “We’re
not actually selling a product but a relation-
ship” (Kay, 1994).
Recommendations to Adam and
Company and The Royal Bank of
Scotland
The main recommendations are summarized
in Table I and Figure 7.
Recommendation 1: The Royal Bank of
Scotland to maintain the autonomy of
Adam and Co.
It is recommended that the Royal Bank of
Scotland maintains the autonomy of Adam
and Co. by
• adopting a laissez-faire policy with regard
to the bank’s management;
• keeping Adam and Co. as a distinct brand
(avoiding endorsement with the Royal
Bank’s name);
• allowing Adam and Co. to hold on to its
distinct system of recruitment and train-
ing.
As the case study revealed, the bank’s distinc-
tiveness was mainly derived from the behav-
iour of personnel. To date, the success of
Adam and Co. is attributable to the fact that
its service quality reflects the needs of cus-
tomers. Even though it was widely known
that the RBS owned Adam and Co. the case
study revealed that clients of the bank still
saw themselves as customers of Adam and
Co. rather than of the RBS. Thus while the
RBS gave Adam and Co. access to a wider
range of back up services the perception and
positioning of the RBS was so different from
Adam and Co. that both identities need to be
kept apart and managed differently.
Recommendation 2: concentrate
resources on relationship management
Since much of the bank’s identity is based on
a superior and distinct customer service it is
important that this aspect is maintained and,
where possible, improved.
Recommendation 3: segment Adam and
Co.’s client base
It is important for Adam and Co. to
• be aware of the different groups using its
services;
• to take on the needs of such groups;
• to identify potential for growth of key
groups;
• eliminate groups which are a “cost” to the
bank.
Figure 7 is a matrix of Adam and Co.’s client
base based on information derived from the
interviews at Adams and Co. Figure 7 is also
based on the Boston Growth-Share Matrix
with the dimensions being changed: “use
of bank’s financial services” and “wealth”
instead of “market growth rate” and
“competitive position”. Table II shows the
recommendations based on the matrix
shown in Figure 7.
The case study revealed that Adam and Co.
had four main categories of customer
1 Full members.
2 Nominal members.
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[ 181 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
3 Aspirational members.
4 Pretenders.
For the main, these classifications were felt to
be distinctly different from Balmer’s (see
Appendix 2) and this might suggest that
Adam and Co.’s direction is sufficiently dif-
ferent from other private banks, including
those within the RBS group.
The four main categories of client using the
bank’s services are as follows:
Full Members are those who have
integrated all their financial assets into the
bank, and are very wealthy. Full members
allow all their financial needs to be handled
by the bank. The relationship between the
bank and these clients is very close. These
clients should be encouraged to see them-
selves as members of a club, rather than just
clients of a bank.
Nominal Members have substantial wealth,
but do not use many of the services provided
by the bank. Most nominal members use the
bank for investment management services.
Aspirational Members use a wide range of
the bank’s services, but at the moment do not
have a substantial amount of wealth to invest.
These clients would probably be the young
lawyers and accountants whom Adam & Com-
pany court.
Pretenders have little wealth. They use
many of the services provided. The inter-
views suggested that, in may cases, these
clients had been allowed to open an account
with the bank for the wrong reasons. Quite
simply, when the bank started business in
1985 it was seen to have clients and waived
the requirement that individuals should have
Figure 7
Matrix of Adam and Co’s client base based on the dimensions of: use of the
bank’s services; and wealth
Wealth
“Full members”
“Nominal members” “Aspirational members”
“Pretenders”
High
Low
Use of
bank’s
services High Low
Table I
Summary of recommendations
Recommendation Explanation Objective(s)
1. Royal Bank of Scotland to clarify Possibility of Royal Bank’s Maintain Adam and Co.’s distinct
and maintain the autonomy of subsuming Adam and Co.’s market position in private banking.
Adam and Co. identity might have a negative Enables Adam & Co. to offer a
reaction from clients distinct service. Keep Adam and
Co.’s distinct method of
recruitment and training: this
provides an important foundation for
Adam and Co.’s identity
2. Concentrate resources on Relationship with clients is Adam Consolidate Adam and Co.’s
relationship management and Co.’s greatest asset and is competitive advantage in relation to
the principal reason for the bank’s retail and other banks
success
3. Segment Adam and Co.’s Adam and Co. can position its Maximize profit
client base using the matrix service and resources more Improve/maintain service policy
in Figure 7 effectively in order to meet the Build on the bank’s loyalty and
needs of difficult clients reputation
Table II
Recommendations based on the matrix of Adam and Co.’s client base
Recommendation Explanation Objective
Reduce number of “pretenders” These clients are a cost to the bank Frees up accounts managers’ time
by increasing service charges and a drain on its resources and enables them to concentrate
time and effort on more valuable
clients
Increase number of “Full members” These groups have either wealth Clients will use a wide range of series
and “Aspirational” members or wealth potential and are likely offered by the bank and are likely to
to use the whole array of the remain loyal and promote the bank’s
bank’s services service through word of mouth.
Profitable groups for the bank
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[ 182 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
an annual income of £50,000 and assets of over
£250,000 as reported in Greaves (1989). The
main motivation for remaining with the bank
might be to use the cheque book and the
bank’s name for pretentious reasons are simi-
lar to the “social aspirants” mentioned in
Appendix 2.
The bank’s main asset are the full mem-
bers. The main liability are the pretenders.
The authors conclude that pretenders should
be discouraged from using Adam & Company.
Their financial investments are not substan-
tially significant to justify the bank’s identify-
ing its valuable resources in offering a close
relationship with such clients. With the
account managers already being responsible
for a reasonably large client base, their time
and effort cannot be wasted in keeping these
clients satisfied. The bank should adopt the
same policy of Child and Co. in reducing the
number of pretenders.
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Appendix 1. The International Corporate
Identity Group’s (ICIG) statement on corpo-
rate identity
“The Strathclyde Statement”
Every organization has an identity. It articu-
lates the corporate ethos, aims and values
and presents a sense of individuality that can
help to differentiate the organization within
its competitive environment.
When well managed, corporate identity can
be a powerful means of integrating the many
disciplines and activities essential to an orga-
nization’s success. It can also provide the
visual cohesion necessary to ensure that all
corporate communications are coherent with
each other and result in an image consistent
with the organization’s defining ethos and
character.
By effectively managing its corporate iden-
tity an organization can build understanding
and commitment among its diverse stake-
holders. This can be manifested in an ability
to attract and retain customers and employ-
ees, achieve strategic alliances, gain the sup-
port of financial markets and generate a sense
of direction and purpose. Corporate identity
is a strategic issue.
Corporate identity differs from traditional
brand marketing since it is concerned with
all of an organization’s stakeholders and the
multi-faceted way in which an organization
communicates.
John M.T. Balmer (University of Strath-
clyde & Chairman ICIG)
David Bernstein (Vice President of ICIG)
Adrian Day (Managing Director, Landor
Associates, London)
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[ 184 ]
John M.T. Balmer and
Snorre Stotvig
Corporate identity and private
banking: a review and case
study
International Journal of
Bank Marketing
15/5 [1997] 169–184
Stephen Greyser (Professor of Business
Administration, Harvard Business School)
Nicholas Ind (Identity Consultant)
Stephen Lewis (Director, MORI)
Chris Ludlow (Managing Partner, Hen-
rion, Ludlow & Schmidt)
Nigel Markwick (Consultant, Wolff Olins)
Cees van Riel (Director, Centre for Corpo-
rate Communications, Erasmus Univer-
sity, Rotterdam)
Stephen Thomas (Director, CGI Identity
Consultants)
This is a revised version of the original state-
ment which was drafted at Strachur, Argyll,
Scotland, on 17 and 18 February 1995.
Appendix 2. Segmentation of private
banking customers identified by Balmer
Middle age financial spread
The so called “baby boom” generation are
now well into their middle age and are finan-
cially well-off. Many individuals in this group
have been recipients of considerable inheri-
tance which in many cases includes the own-
ership of a parental home. Thus, overnight,
many individuals in this age group have
become high net worth individuals (HINWIs).
The ethos of wealth management and
enhancement is likely to be attractive to this
group. As one American essayist remarked
“Once a fortune has been acquired it takes ten
times as much wit to keep it” (Hanson, 1994).
The number of HINWIs has been increased
also as a result of changes in the legal envi-
ronment during the 1980s through the
increased number of tax incentives and other
leveraged financial instruments (Odier and
Lenhard, 1994).
Parvenu entrepreneurs
Many third world countries have undergone a
degree of economic transformation, which
has resulted in a new class of business entre-
preneur who, understandably, is attracted to
the services offered by private banks. This
market is particularly strong in Latin Amer-
ica and Asia and there has also been a small
but significant group of customers from
China (Barchard and Cohen, 1991).
Expatriate communities
Expatriate communities find the
convenience, support, and individual service
offered by private bankers attractive. (Partic-
ularly applicable to the European market).
Followers of fashion
Attributes of private banking such as
access, convenience, safety, personalization
and business ethics can also be reasons why
individuals are drawn to private banking
(Odier and Lenhard, 1994). For instance, a
bank’s address, architecture, interior and
product design (leather cheque books,
graphic design of cheques) and the house
style with regard to correspondence, e.g.
“We remain your most obedient servants” at
the close of letters from Messrs Hoare and
Co.) and staff apparel (the wearing of frock
coats by managers at Coutts and Co.) can be
an added attraction and even an attraction
on its own (see “Blue bloods” below). Gail
Carghill of Lloyds Private Bankers says
“Some of our clients love the [leather clad]
cheque books and the gold payment cards.
They also like the civilised surroundings”
(Kay, 1994). The bank’s exclusive customer
base is often an additional attraction.
Social aspirants
Some private banks are happy to offer pri-
vate banking services and the attendant
high banking fees to those who by any mea-
sure are not regarded as HINWIs. Typically
this group are aspirational and wish to
become a HINWI or wish to acquire a high
social standing. Having a private bank
account with all its trappings and prestige
serves a particular psychological need. If
you cannot mix with the great and the good
you can at least bank alongside them. This
group’s attitude may be best summed up by
the statement that “Where you bank is what
you are” (Economist, 1990).
Blue bloods
The categories of customer outlined above
are in stark contrast with the groups who
traditionally use the services of private
banks in Switzerland, London and in the
East Coast of the USA. With regard to the
latter, Morgan Guaranty and US Trust and,
more famously, Brown Brothers are blue-
blooded, North American, private bankers:
a sizeable percentage of their business
comes from “old money”. For example, at
the end of the 1980s, it was reported that 40
per cent of US Trust’s business was from
second generation family members (Wood,
1989, p. 7).
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