Financial services industry has more neck than it had before the crash

It's night time. A pensive, maybe angry, man sits at the wheel of his car, trying to decide. His mind finally made up, he crosses the road and rings a door bell. While we’re waiting for an answer, another man somewhere else fires a starting pistol to get a race under way on an athletics track. Like the scene at the door, the race is being run late at night, in the dark, and also, apparently, in thick fog.

The door is answered, by an equally solemn, possibly also angry, man. This one has a beard. He takes a long hard look at the first man. “John,” he says.

The tension is unbearable. We really need the ice to be broken between these two. But before it is, another old man plays with his grandkids, a woman takes her first driving lesson, a (shall we say) well-built man stands on a weighing scales and pulls in his stomach (because that makes a difference, as we all know). An African man becomes a citizen (of Ireland, presumably), two girls decide to kiss each other, and a woman sitting on her loo discovers she’s pregnant.

And in the middle of all that, the two men at the doorstep, years of tension evident between them, embrace in a manly bear hug. Whatever about the past, this is a new beginning. Sorry, not a new beginning. In the words of the Bank of Ireland, this is a new “begin”. All these vignettes, and a few more packed into a very expensive minute-long television ad, are new begins. They are the reason Bank of Ireland is here. For all the new begins. Because no two begins are the same.

On another TV channel, however, a historic announcement is being made. Ireland, after years of discrimination, has decided, in one fell swoop, to introduce free second level education. This one decision will change the future of the country for ever. It was a gutsy decision by Daragh O’Malley, made back in 1966. It was widely believed at the time that he had overstepped the mark and would end up in trouble. However, it emerged that he had the support of the taoiseach, and the announcement of free second level education was wildly popular. One of those things that everyone thought couldn’t be done, but the doing of it cemented Daragh O’Malley’s place in history.

Whoa. Hang on a minute. Wasn’t it Donogh O’Malley who made that famous announcement? Who is Daragh O’Malley? It turns out that Daragh O’Malley is Donogh O’Malley’s son. He’s an actor, and a good one, who has recreated his father’s famous speech for the purposes of a television ad. The ad was made for an insurance company called Allianz. That’s because Allianz covers courage.

They do what? Well, if you believe the ad, they cover courage. If Donogh O’Malley wanted, back then, to take a huge political risk, and wanted someone to insure him lest his political career came to a sudden end, Allianz would have provided the safety net.

In my foot. One of the most remarkable features of the economic recovery has been the way in which the financial services industry has, if anything, more neck than it had before the crash. There’s no insurance company in Ireland that is willing to insure anything because it’s courageous. Try going into any branch of the Bank of Ireland in the hope of getting a loan just because you want, or need, to begin again. You’ll be run out of it.

Last year, the Financial Services Ombudsman and the Pensions Ombudsman were merged into a single body, called the FSPO. In that capacity it has been in operation for one full year, and for the first time has had the power to make legally binding recommendations.

The FSPO could not, I think, be accused of having a high profile. Unlike the financial bodies that it has the power to investigate, it doesn’t advertise its services. Nevertheless, by the end if its first full year of operations, it had made more than 200 legally binding recommendations. The Ombudsman is shortly to produce its first annual report, which will contain a detailed analysis of all the complaints received.

It’s a lot of complaints after just a year of operations. It doesn’t, of course, add up to a picture of dishonest practice — in the main, the complaints dealt with were of an individual character. But I’d love to see the Ombudsman’s remit broadened just a little, to enable him to look at the advertising the industry does, and to make a judgement about whether the basic level of customer service measures up to the outlandish claims the industry makes.

Every now and again, the industry does get caught out. Last year the Advertising Standards Authority (the advertising industry regulates itself) found that an AIB television ad, which featured all sorts of people hitting images of interest rates and making them explode (“we’ll replace all these awful rates with a single rate that applies to everyone” was the message), was materially misleading. The ad disappeared.

But that doesn’t happen often, does it? The insurance business doesn’t insure courage. Bank of Ireland doesn’t go out of its way to provide funding for new beginnings. AIB, by the way, doesn’t back brave, despite years of advertising to that effect.

They don’t back “doing”, either – so next time you go into the bank with a photograph of the manky old banger of a car in your garage at home, don’t expect the manager to leap out of his chair and promise to help you turn it into the retro car of your dreams. Sure they’ll do that. Provided you meet the terms and conditions. Provided you have whatever security is asked for. Provided your existing financial status mean that you’re worth it. It was always thus, and it will always be thus.

In fact, it’s worse now than it used to be. You’re unlikely ever to meet a bank manager nowadays in your local bank branch — assuming you can find one of the ever shrinking number of branches that exist.

What you will meet is an algorithm, because that’s how the huge majority of personal lending decisions are made nowadays. If you get to talk to a human being, that is only to enable the human being to punch your data into a computer.

But it’s the computer that decides whether it wants to back your begin, or your brave, or your doing. Once the data has been entered, lines on a screen tell the human being what to say. And the computer doesn’t give a monkey’s about what you’ve been through, or how wonderful your idea is, or how much you might deserve help.

The computer has only a few cynical questions. How much can we charge? How certain are we to be repaid? How good is the security? If you can answer those questions to the satisfaction of the computer, it will probably think you’re very brave indeed. If you can’t, the computer will simply say no. Then you can go home if you like, watch their ads on the telly, and dream on. The basic level of customer service (hardly) measures up to the outlandish claims the industry makes