Big banks not so popular among small businesses

May 13, 2010

A new study showed the big U.S. banks have some work to do to if they want to improve their image among small and mid-sized businesses.

The annual report, released by Portfolio.com and based on research conducted by American City Business Journals (ACBJ), surveyed 1,762 business owners, CEOs and presidents of companies with more than one employee and asked them to rank 207 brand-name companies, from the technology, telecom, travel, financial and media sectors, on a set of seven different attributes.

Among banks and financial services firms trust remained the biggest issue for the small business owners polled, said Godfrey Phillips, vice president for research at ACBJ.

“Small businesses care about whether the bank they deal with is ethical,” said Phillips, who noted U.S. Bank was voted the top bank brand, but was No. 109 among companies on the overall list. Both Citibank and Bank of America plummeted due to negative publicity. “The bigger the bank, the more it got hit. Regional banks and local banks in our survey did well, just because that’s where people have their relationship with and they weren’t in the news. When you’re in the news you drop substantially.”

Another interesting finding, noted Phillips, was the emergence of online brokerage firms such as TDAmeritrade and E*Trade, which both placed in the top three among financial services firms.

“Another area where we really saw a big jump on was that people started to manage their money more so than before,” said Phillips, adding it was emblematic of the wider trend of people moving away from full-service brokerage firms. “And their perceptions of themselves as investors had substantially improved, because they just started to be more involved in how they handled their money.”

The survey polled entrepreneurs with more then $250,000 in investable assets. Phillips said the poll is the only business-to-business survey as opposed to business-to-consumer polls.

Photo source: The logo over a Citibank branch is pictured in Chicago March 10, 2009. REUTERS/John Gress

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