Metro Bank is the first new bank in the UK in over 150 years, moreover, the “challenger bank” is not just aware of its upstart credentials, it’s proud of them.
Of the many deliberately provocative slogans used by Metro Bank, perhaps the simplest and most honest is the call to “join the revolution.” And like every good revolutionary movement, Metro Bank has its own charismatic leader, an American man who says his job “is to create fans, not customers. This is the banking revolution.”
Vernon Hill II, chairman of Metro Bank, is, to lurch wildly into the realm of cliche, is as American as apple pie. Not just any apple pie either, he is, dare I say it, perhaps even the quintessential americana McDonald’s apple pie.
Hill’s reputation as the “fast food banker,” makes this analogy rather apt. But, the real compliment that lies behind this title doesn’t quite translate into British. Welcoming you into his bank with a handshake and a smile, he is as convivial as the most American stereotypes of customer service.
His first floor office is not in the Ivory towers of Canary Wharf and the City proper, but rather directly above the Metro Bank flagship branch at the head of the Kingsway metropole in Holborn. This is the clearest signal of intent you will take from Vernon Hill about precisely the type of bank he wants Metro Bank to be.
“We have a retail concept that happens to be a bank,” he explains, “there was a lot written in America about my model as the Apple of banking.” This is most aptly explained by his catchy saying “great brands, grow by building fans.” He makes it very clear to me that Metro has “stores, not branches.”
Clearly very proud of being compared to Apple, Hill tells me that “we learned over the years in America to make the stores open, fun, friendly, and inviting.” This simple and yet revolutionary approach distinguishes Metro ‘stores’ from the grey stone branches of British high street banks.
Moreover, his philosophy seems to be working. Metro Bank recently launched on the London Stock Exchange, after raising £1.1Billion in private capital (90% of which came from American investors).
Metro Bank’s wave of new branches will practically allow them to live up to their claim to be “your local bank.” Since 2010 when the bank launched, they have gone from 4 branches to 40, from 9,000 customer accounts to 655,000. By the end of 2020, Metro Bank is aiming to have 110 branches.
The newest and 41st branch is opening on the King’s Road, April 15th, complete with a “gigantic party for the public.” But bringing the Vernon Hill high street ‘store’ to Chelsea has not been entirely smooth sailing.
“I get more comments about building this store than any other store,” he tells me, “it’s like all the good and the great live down there.” The main debate between Hill and the Royal Borough of Kensington and Chelsea was over the characteristic look of the Metro Bank facade.
Following the Apple comparison even further, Hill describes the distinctive look of his banks as big, open, and inviting. Huge floor to ceiling glass tower windows, along with the removal of the first floor, quite deliberately reference Apple stores, rather than the banks we are used to seeing.
The King’s Road Metro Bank will have a rather more demure appearance than, for example, the flagship store in Holborn. But the true measure of the change Metro Bank wants to bring to Chelsea lie in the services and ethos they can offer their customers.
“The big four banks have all shut their safety deposit boxes,” he says, “I can’t build safety deposit boxes quick enough to keep up with the demand.” In the King’s Road store, there will be 3,000-4,000 boxes and Hill assures me “there will be a huge demand there.”
Increasingly, his competitors are closing branches as they tell customers there is little demand for the services they provide. Hill pours cold water all over this. New branches are due to open throughout the country, including in Clapham Junction, Wimbledon, Islington, and Oxford.
“There is a theory that goes around that bank branches don’t matter,” he says, and a theory that retailers need to make around $400-500 per square foot, Apple does $6,300 per square foot.”
“Almost everyone wants to open an account with us in store,” he says, and “once you open your account with us then it’s my job to offer you the best of every service in our bank.”
It is testament to just how right Mr Hill is about the current state of British retail banking, that the services Metro Bank are most proud of offering, have thus far been derided as “mere gimmicks.”
“That’s just the British word for it,” Hill tells me jokingly when I put this to him . He smiles and looks confidently subversive while telling me “you can open a new current account with us in 10-12 minutes, you’ll walk out with your account open, we activate your online, print your debit card while you are here, and you walk out the door, try to do that at another bank.”
“We have a policy called: Kill stupid rules,” he continues “and we are on an endless track to kill every stupid rule.” This is where the bank wrongly gets accused of using gimmicks. Metro Bank is has killed rules about no dogs in banks (“we even offer a free microchipping service” he adds), they are open 24/7, and they freely exchange coins, pens aren’t chained to the branch, they have human staffed call centres.” Gimmicks are, in Hill’s mind, actually about free market economics, and most of all offering his customers the services they want – when they want them.
I will admit, the day after our interview I switched my bank, who I have been with for over a decade, and opened a current account with Metro. I have nothing worth keeping in a safety deposit box, I don’t have a dog, I certainly won’t be taking one of the 1.168 million free pens they have handed out, and I am sure that in almost every respect Metro Bank is “just another bank.”
Nevertheless, I changed because I think this is exactly what we need. Not just for banks either. As he said to me: “This is about dramatic change.”
Before leaving the interview I asked Hill about Donald Trump and the American election, knowing full well that he and Trump were at Wharton, University of Pennsylvania together.
Hill said to me: “I won’t give you a single thing on him but I will say that I know him very well.” But then he described the Trump phenomenon as “the American public tossing a bomb into the middle of Washington. How else can you explain Bernie Sanders, a 74 year old, admitted socialist, giving this Clinton woman a tough time. This is a revolt about the political class.”
People are desperate to portray Metro Bank as the Trump in our retail banking sector. But in truth, Vernon Hill is less Donald Trump (or even Ronald McDonald, for that matter) and more Steve Jobs.