Nationwide says ‘you don’t need a bank’ ads helped double profit

Nationwide says its marketing campaign to persuade current account customers unhappy with the actions of traditional high street banks to switch to a more ethical alternative is paying off after it reported a spike in customers in the first-half of its financial year. 

Nationwide
Nationwide says ‘you don’t need a bank’ ads helped profit double in its first-half.

The mutual says it opened 214,000 new current accounts in the six months to 30 September, up 16 per cent on the same period last year, pushing its share of the market up 0.8 per cent to 6 per cent. Fifty-four thousand customers switched decided to switch their primary banking products to Nationwide in the period, it adds.

The uplift in current account customers coupled with an improved mortgage book helped Nationwide more than double underlying pre-tax profit to £332m in the period, up from £130m.

The building society’s has been running ads with the strapline “you need a bank account, you do not need a bank” since it identified an opportunity to poach disgruntled customers of Natwest, Royal Bank of Scotland and Barclays in the wake of the financial crisis and LIBOR rate-rigging scandal.

It has stepped up media spend in the last three months to exploit the introduction of the Payment Council’s account switching service aimed at speeding up and simplifying the process for prospective customers.

Nationwide chief executive Graham Beale told Reuters the number of customers switching their accounts to it had risen 47 per cent in the weeks since the service was introduced on 16 September.

Beale adds in a statement: “We have made further strides towards growing our share of the current account market. Supported by the implementation of our new banking system and the launch of two new current accounts over the past year, we opened over 214,000 new accounts and saw 54,000 customers switching their primary banking relationship to us, proving yet again that while customers may need a bank account, they do not need a bank. “

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