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CREDIT UNIONS WINNING THE BATTLE FOR CONSUMER TRUST

May 12th, 2009

TNS Survey Finds Credit Unions and Regional Banks Outperform National Banks in Trust, Reliability and Confidence Ratings


New York, NY - May 12, 2009 - TNS, the world's largest custom research company, today released the latest results of its Trust Survey. Despite large-scale brand marketing initiatives currently underway, the nation's large national banks, insurance companies, and brokerages are continuing to slip further behind smaller regional banks and credit unions in consumer trust ratings.

Fielded in October 2008 and January and April 2009, this survey of 1,000 US consumers charts trust levels across several major industries and gives detailed insight into consumer attitudes toward financial services companies.

Reflecting the current economy and what we've been hearing in the news, consumer trust decreased across the board in the first four months of 2009. The biggest drop in consumer trust between January and April was seen for banks and brokerage/investment firms, public sector/government, and automotive. This comes on the heels of a drop in consumer trust for both the automotive and banking industries during the prior period (October 2008 to January 2009). After a brief rebound immediately following the presidential inauguration in January 2009, the public sector once again shows a reduction in trust ratings.

According to Trish Dorsey, Senior Vice President, Financial Services Brand and Communications TNS, "Consumers' continued distrust of large national banks and brokerages is a signal that they are looking to large financial institutions for strength and leadership. As a category it is clear that they have not demonstrated their leadership position effectively and consumers are left feeling inadequately supported and deeply distrustful."

Credit Unions make Major Gains
Smaller banks and credit unions rated consistently higher than large national banks throughout the study. In April 2009, 61 percent of consumers said that their trust in large national banks had declined over the last three months compared with only 17 percent for credit unions and 24 percent for small local and regional banks. Every category of financial institution showed a decline in confidence levels between October 2008 and January 2009.

The exceptional news is the way that credit unions are making such positive progress across multiple trust dimensions, despite continuing economic and financial insecurity. Measured across nine different trust dimensions, including overall, rational and emotional attitudes, consumers surveyed show significantly greater trust and confidence in these smaller players who they feel show greater understanding and reliability than the large national banks.

The credit unions alone demonstrated significant bounce-back in consumer trust from January to April 2009. Although the small/regional banks managed to hold steady and make minor gains across some trust dimensions, the change was not significant. Large banks have been losing ground consistently since the beginning of the financial crisis.

"Between October 2008 and January 2009 there was very little good news in banking so the decline in trust across all categories was consistent with the financial environment," commented Dorsey. "The fact that credit unions have improved their consumer trust and confidence scores implies they are doing a better job of engaging their customers and making them feel safe with their financial choices. The larger institutions need to step up and take a leadership role in reassuring customers of their financial stability."