Branch transformation, the future of the high street and focused charitable investment were the three main topics of discussion at the BSA’s Reinvigorating Communities event on 9 September.

This followed the BSA’s research earlier in the year, which emphasised the building societies sector’s social purpose and showcased the major investment our members are making within their branches.

Speaking at the event were building societies Coventry, Principality, Nationwide, Newcastle, Newbury, Hinckley & Rugby and Leeds, who all talked about how they are revamping and reconfiguring their branch networks and focusing their engagement to help communities build and grow. 

Experiences are worth more than material things

Providing an external overview was David Martin from branch design consultancy MWorldwide, who talked about how brands and high streets have responded across the world to people shopping online rather than in bricks and mortar shops.

The fightback has chiefly been via businesses offering consumers experiences rather than simple product-led transactions, which can usually be beaten in terms of price and selection online.

In the world of financial services, this trend has been mirrored with the shift to more of us managing our finances digitally rather than checking into local branches. In response, Martin highlighted a recent project he had worked on for Lloyds Bank and its flagship branch on Manchester’s Market Street. Just as with Clydesdale and Yorkshire's B store, rather than traditional branches and tellers, it has an open plan design with free coffee and shared working spaces.

Paul Merrick, business manager of branch networks at Coventry Building Society and Julie-Ann Haines, chief customer officer at Principality Building Society identified similar themes in their respective presentations in terms of how the high street is transforming.

Merrick described how in 2012 Coventry had identified that branches were no longer a sales channel and instead were a service channel for savings. Its current branch transformation programme has focused on removing physical barriers to engage with customers and talk to them about their financial needs. 

Both societies have opened up the floor space of their branches to allow staff to freely engage with Society members. This has freed up space to allow events or meetings to take place within branches and both societies have been experimenting how best to make use of these open community spaces.

But a crucial point of difference between the example of Lloyds’ branch transformation is that both societies are still very much using their branches to engage with customers about their finances, rather than just providing community spaces for brand recognition.

As Haines described, Principality’s branch transformation had been led by its customers and deepening the interaction it has with them via branches. That is clearly resonating with consumers, with footfall rising by a third at Principality as rival bank branches close. 

Helping weak cities become strong cities

The Ministry for Housing, Communities and Local Government (MHCLG) was also speaking at the event, providing an overview of the work it has done to try and reinvigorate communities.

With the latest figures on high streets from PwC for the first half of 2019 showing a total of 2,868 store closures, equivalent to 16 per day and the most for five years, Government support is clearly needed.

It has introduced a range of measures, from the £1bn High Streets Fund and High Streets Task Force to future pilots on setting up a register of empty commercial properties to ensure high streets can advertise opportunities to businesses looking for shop space.

Amid all the doom and gloom about high streets that are failing, the Government is also promoting the Great British High Street Award to celebrate areas that are getting it right, with Altrincham in South Manchester and Crickhowell in Wales examples of areas getting it right.

Nationwide’s director of branch and workplace development Richard Newland picked up a similar theme in his presentation.

Nationwide was one of the first UK high street financial services providers to adopt the open floor plan style of branches.

But with more than 650 branches across the country, Nationwide is looking at not just how it can transform or update its branches, but also how it can have a positive impact on communities.

Newland highlighted research showing that a strong city centre will have 40% of shops used for eating and drinking, compared to a percentage of just 26%  food and drink in weak city centres.

He also pointed to Centre for Cities published research, supported by Nationwide, highlighting that support for vibrant high streets was not just an issue of retail trends, but also about supporting education and employment in communities.

To that end, Nationwide is looking at how it can partner with communities, big and small, to get more people living, working and spending on the high street.
 

Turning charity from tick-box to a core activity

Looking at the role branches play within communities was a theme taken on by Stuart Miller, customer director at Newcastle Building Society. In 2016 Newcastle made headlines for its redevelopment of Yarm Library in partnership with the local Borough Council.

In addition to a major branch transformation programme of its 28-strong branch network with a new open-plan design, it has also started to develop a formula of community partnerships. In July this year, it announced that it was working with a North East Trust to set up a community branch in Wooler, a town that has been without banking services since 2018.

This focus on the role of branches and building societies in communities was also part of Newbury, Hinckley & Rugby and Leeds’ presentations.

Luke Pummell from Newbury Building Society talked through the product it had brought to market with the support of West Berkshire Council for those looking to buy on the open market or purchase their shared ownership property. With affordability difficult for many, the First Step, Next Step scheme lends lending up to £30,000 to help eligible borrowers top up the deposit needed for a mortgage.

Hinckley & Rugby Building Society’s chief executive Colin Fyfe talked through the work he has done in his first seven months as the new head of the Society, in particular community engagement via charity work.

Fyfe was previously chief executive of Darlington Building Society, and while there, the society developed an affinity scheme whereby every completed mortgage led to a £250 donation to a selected local charity.

He made the point that one off charitable events are often about individuals utilising their brawn rather than brain. However, sharing knowledge, skills and potentially even branch premises with groups was also key. 

Social impact was the focus of Leeds Building Society’s presentation, with its corporate responsibility manager Luke Wellock explaining how the mutual had not just taken a focused approach to community investment but also used the UK corporate giving index GivX to value their fundraising and donations and the actual impact it is having.

GivX provides individual company social impact scores and sector benchmarks, with a minimum of 10 firms required for the latter. The building societies sector narrowly missed out on a sector benchmark for 2019 and Wellock explained that GivX is working to build on this for 2020. 

But for Leeds the result has been a two-year relationship with Samaritans to help the charity invest in new technology. In addition to Leeds donating its shirt sponsorship of the Leeds Rhinos to promote the Samaritans in August, the charity has also helped train Leeds staff in handling emotional distress.

Revamping, upgrading and supporting

Savings and mortgages might be the central means by which building societies support their members, be it someone saving for their first home or a retiree buying what may be their final home.

Nevertheless, of equal importance is the role that building society staff and branches play in their respective communities. Branches are not just bricks and mortar but a place for staff to talk to customers about products, their day-to-day lives and understand how they can further support their local area via charitable giving or collaborating with local groups.

The event displayed the massive amount of work building societies are doing not just in terms of revamping and upgrading their branches but also supporting the communities that they depend.

All of the slides are available for BSA members and associate members to access here.