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19th October 2012

Big UK retail bank brands lose market share
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The JGFR /GfK banking barometer shows smaller UK retail banks / brands gaining market share as the Main Financial Service Provider whilst larger banks losing share.

Santander, Nationwide, Cooperative Bank, Bank of Scotland and First Direct all gained market share. The biggest loser of market share was Lloyds TSB followed by National Westminster. Barclays, HSBC and Halifax (5th largest) also lost market share to a lesser extent. Interestingly the jump in First Direct market share is attributed largely to women moving to the bank.

The top five retail brands, Lloyds TSB, Barclays, HSBC, National Westminster and Halifax saw a combined fall in market share fall of 11% from 66% of the market to 55%. Lloyds Banking could have been affected by the Payment Protection Insurance scandal, having been the most aggressive seller with the highest penetration of sales.

It is interesting to note that different subsidiaries of the banking groups have performed in different way. Lloyds TSB showed a major fall, Halifax a minor fall and Bank of Scotland a gain in market share yet all belong to Lloyds Banking Group. Similarly, HSBC subsidiary First Direct gained market share whilst HSBC main bank lost share. The subsidiaries have different characteristics and it is also possible the Bank of Scotland gain was at least partly motivated by a desire to move from the Royal Bank of Scotland. HSBC has a lengthy authentication process followed by queuing to speak with an advisor by telephone compared with First Direct's no queuing and fast authentication.

JGFR commissioned GfK NOP to run a question alongside the March, June, September and December Financial Activity Barometers and Consumer Confidence Barometer to find out who
people considered to be their main financial services provider in March 2003. It has run quarterly since.