Banking cultures - or, why are they so weird?

I have seen several institutions in the financial sector, dwelling in different niches in the same sector, being located in as different countries as Ukraine, Germany, Switzerland, Austria, UK. Also these are not my first musings on this topic.

But they still puzzle me.


Although each has its own characteristic depending on the embedding country culture, the market forces driving a certain behavior or some more individual traits rooted somewhere deep in their history, they also do have something in common: something inanimate, inhumane, somewhere in between a machine and a pack of raiders.

Yes, and at least for a while, I am back in a typical banking culture - and I wonder why banking cultures use to be so weird. By the time three distinct suspicions came to my mind – and refuse to fade away again: reputation, money and product. Ok this needs some explanation. So let me elaborate a bit on this threefold suspicion.

I suspect it is because compared to other industry sectors the single employee's contribution is less important here. Rather the reputation or image (or you may call it false face) of trustworthiness and professional competence of the whole abstract organization drives the success. Such set-up does not require motivated employees. They just have to comply with the rules, the more machine like approach.

Also - as banks traditionally deal with money - employees are distrusted at first hand and are heavily supervised. They might get corrupted by the huge assets; they have to take care of, while themselves they may struggle to pay their rent. They in turn react in their way - just 'work' for the money, turning them to - how NNT would call them - corporate captives.

Maybe banking culture is influenced by the fact, that banks don't have real products to sell to their customers, at least no tangible ones, and most often even not a conceptually defined and implemented ones. They, more or less, go straight for the numbers. The bottom line however doesn’t stimulate the member’s imagination. Of course there are so called ‘banking products’. And if you take investment banking, they may become so complex and sophisticated, that even the more simple minded individuals among the bankers, and there are some of those around, don’t understand them – but happily sell them. But, take retail banking: a simple current account is not enough a product, which can be attributed customer value to, to safely isolate even benevolent individuals from the cruel forces of the bottom line.

After having said that, it may not surprise you, that several banks invest some serious effort to deliberately change their culture (e.g.:  here) – giving me the impression, that they consider their culture like a broken washing machine, which just needs fixing. To take an – dated – example, according to the above mentioned source: “Citi’s new CEO Michael Corbat is trying to change the culture to bring more accountability and discipline through the use of score cards for top executives based on a set of weighted goals from five categories: capital, clients, costs, culture and controls.” However, to cite the voice of a non-disclosed British regulator: “The cultural change that we hoped for never actually happened”.

Deliberate culture change is not impossible per se. But it has to be done firmly founded on truthfulness of the underlying intentions. Corporate culture cannot be cheated. It will otherwise strike back and possibly eventually honor Bertold Brecht view “What is the robbing of a bank compared to the founding of a bank?”

And - as always - comments are very welcome!