Welcome to this July newsletter from the Customer Union for Ethical Banking, the independent union for customers of The Co-operative Bank
In this newsletter, we reflect on the ongoing Farage/Coutts affair and the attack on the idea of ethical banking that is under way. And: are you a member of the CAMRA investment club?
The Farage/Coutts Affair and what it means for ethical banking
At the start of July it was reported that broadcaster and former UKIP and Brexit Party leader Nigel Farage had his bank account closed by Coutts, a subsidiary of NatWest that serves ultra-wealthy “high net worth” clients”. An almighty row has followed, which has resulted in both Coutts and the BBC apologising to Farage, and NatWest’s first female CEO, Alison Rose, resigning in the early hours of last Wednesday morning under clear government pressure.
So, what does this have to do with the Co-op Bank? Well, for one thing, new rules were introduced following the scandal which will require banks, including the Co-op, to give 90 days’ notice instead of 30 when closing customers’ accounts, and to give reasons. This will impact the Co-op, whether it closes accounts for ethical or other reasons.
But also at issue here is the question of whether banks can legitimately close accounts based on peoples’ views – and questions are also being raised about banks’ entitlement to make other ethical decisions about whom they finance. The Co-op has closed organisations' accounts (but not individual accounts) where they considered their views to represent discriminatory hate speech – a move we backed as one of its “greatest hits”. We firmly support the right of the Co-op and other banks to turn away business on ethical grounds.
Before Alison Rose’s resignation, we published a blog on the Save Our Bank website setting out our view, that particularly when it comes to business customers, the principle of ethical banking needs defending. We also were invited to share our view with the Saturday Times here (£).
We also want to point out that there are far more important things going on in the world than Nigel Farage needing to find alternative banking arrangements. Perhaps the government and the media should focus on what’s really important, like the twin crises of nature collapse and climate chaos that humanity is facing, and which are acutely affecting millions of people around the world this summer. But there we are.
Banks and the arms trade: the more important ethical banking story being overlooked
Overlapping the Coutts scandal has been another story, with potentially much more serious repercussions for ethical banking. The Telegraph reported (£) earlier this month that the MOD has launched an investigation into banks “closing down defence companies’ accounts” – and the Daily Express made the story a front-cover splash with the headline“WOKE BANKS ‘A RISK TO NATIONAL SECURITY’”.
Some background here: the phrase “woke banks” is one that has been borrowed from a pretty toxic discourse from the Republican right in the US, which has seen banks and investors come under attack for “ESG” approaches which profess to take environmental, social and governance issues into account in financial decisions. The Sunday Express rolled it out again in a front-page on the Coutts/Farage affair. It’s a topsy-turvy world view in which banks that have fuelled financial crises, indebtedness and climate chaos are attacked for giving mere lip-service to doing business better.
(There’s even a website, stopwokebanks.com, which we won’t link to. Makes us wonder if we should set up a rival at StartWokeBanks.com. Your views are welcome!)
To get back to the matter at hand, though, the idea that the government is investigating banks for refusing to finance the arms trade is deeply concerning. This is not about the rights of banks to make their own decisions, but about our own rights as customers to ensure our money does not support businesses we disagree with. We urge the Co-op Bank to stick to its guns (pun intended) and defend its business model.
Meanwhile Nigel Farage has seen his chance to attract attention his way, and declared, again in the Telegraph, that his “war on woke banks” has just got started. Watch this space.
New “Don’t Bank on the Bomb” report list Co-op in “Hall of Fame”
With some relief we move back to the world in which financing weapons of mass destruction is viewed as a sane and rational response to clear international norms: the Dutch peace organisation PAX has released the latest in its long-running “Don’t Bank on the Bomb” report, which again has The Co-op Bank as the only UK member of its “Hall of Fame”.
The report shows that the number of “financial institutions that restrict or prohibit investments in companies involved in the development, production, testing, maintenance and stockpiling of nuclear weapons” has increased steadily over the years. The Co-op Bank’s position on the arms trade includes a clear statement not to support any business that “manufactures or transfers indiscriminate weapons”. We think this is a good thing - it's what the bank's customers want.
CAMRA members investment club?
And finally, having made our recent crowdfunding total, we've now commissioned some of Ethical Consumer's researchers to begin the planned "feasibility study into the development of a co-operative share acquisition vehicle for customers in the Co-operative Bank."
Amongst the already existing models out there that they are looking at is the Campaign for Real Ale's investment club (https://cmic.uk.com). If any of our newsletter readers are members of this club already, the research team would be interested to ask them some questions.
If this is you, do email us at email@example.com and we'll be in touch.
That’s all for this month; thank you for reading and for your support.
Oh, and if you enjoyed reading this newsletter, please share it on social media tagging as @saveourbank or send a link to your friends, family, vague acquaintances or sworn enemies using the [link here].
With best wishes,
The Save Our Bank team
Have you joined the Customer Union yet? It costs £15 a year to be a member of the first ever customer union co-operative, and help us ensure the Co-op Bank sticks to its principles. It only takes a few moments to sign up here.