THE CITY INTERVIEW: How M&S is aiming to clean up retail banking

| August 23, 2012 | 0 Comments

James Salmon

16:21 EST, 22 August 2012


02:20 EST, 23 August 2012

There are not many
bank bosses who can
join in with public criticism
of Wayne Rooney’s
pay package without sounding
ludicrously hypocritical, or who
can claim to have played in the
FA Cup.

But Newcastle-born Colin Kersley is
no ordinary bank boss – he is the MS
Bank boss.

The 55-year-old is responsible for trying
to persuade the retail giant’s army of 12m
regular shoppers to sign up for a bank
account while they peruse the aisles for a
natty summer blouse.

Accountable: Colin Kersley is responsible for trying to persuade regular shoppers to sign up

Accountable: Colin Kersley is responsible for trying to persuade regular shoppers to sign up

Having titilated Middle England with
the announcement it would launch a bank
in June, MS is sending Kersley around
the country opening branches in its

Very soon there should be a MS bank
open in a store near you, with 50 branches
set to open around the UK by the end of
next year.
There are currently four branches including
one in the retailer’s flagship Marble
Arch branch in London – another is opening
in Manchester today.

The aim, says Kersley – who has run
HSBC-owned MS Money since 2009 – is
to bring a ‘retail feel to banking’ and ‘do it
the MS way’.
This, he says, means anything from
‘handbag hooks’ on cash machines to
giving customers a pager which buzzes
when its their turn in the queue, allowing
them to continue shopping in the

The current account launches in October
– with mortgages following suit next
year – but customers have been given
the chance to pre-register since last

He says: ‘The big difference is people
feel they have to go to a bank but they
like to go shopping – we just want to
make it a more pleasurable

Not just any ceo

All of this sounds well and good, but the
new bank account has already received
plenty of flak for coming with an MS
price tag.
Customers will have to pay £15 per
month for the basic account, which
includes vouchers for gifts and drinks to
use within the stores, and £20 if they
want travel insurance thrown into the
Campaigner Consumer Action Group
has already dismissed the account as a
ploy to ‘enforce loyalty to the MS brand’
rather than genuine competition for the
big lenders.
But Kersley makes no bones about the
fact that he is not trying to start a revolution
– it’s merely about giving customers
more choice.

He says: ‘We’re not trying to do anything
but look after the MS shopper. If you
don’t shop at MS there is no point in
having an account with us.’

He adds: ‘Three quarters of our
customers are female with an
average age of 51 – so we have a
unique demographic. We are not
looking to go outside that. Of
course we won’t ignore other customers,
and are looking to take
others on.’

But the retailer’s decision to
charge customers for their current accounts at all is
The debate about whether
banking should be free was
reignited this month when the
incoming chairman of Barclays
Sir David Walker said it drove
lenders ‘inexorably’ to sell customers
products they don’t need
in order to boost profits.

Despite being a 37-year veteran of the
banking industry,
including 30 years at
HSBC, Kersley says he feels unable
to comment on the criticism,
but adds: ‘There is no such thing
as free banking – somebody has
to pay for it, it’s the same in any

Paid for – or ‘packaged’–
accounts have also been criticised
as another cash cow for banks,
again because they dupe customers
into paying for perks they
don’t need.
Kersley says: ‘I’m a great
believer that if you talk to customers
properly and find out
what they need you can’t go far

‘We would not sell anything that
people don’t need,’ he says. ‘Why
would you sell a product that a
customer would reject?’

But the concept should not be
too alien to Kersley.
The mis-selling of payment protection
insurance to borrowers
and complicated investments to
care home residents both
occurred during his time at
In fact, the latter – one of the
most sordid scandals of recent
times which landed HSBC with
a £10.5m fine – occurred under
Kersley’s watch as head of
financial planning from 2007
until he took over MS Money
in 2009.
The mis-selling was perpetrated
by the Nursing Home Fees
Association, a subsidiary of
But the bank’s advisers routinely
referred customers with
relatives in care to NHFA.

Kersley says he was ‘deeply disappointed’
to discover the failings
and said they were ‘totally
Asked about the spate of
recent banking scandals he
argues it is symptomatic of a
wider malaise.

‘I think the world has made a bit
of a mess of itself. Being a 37-year
banker I find it disappointing
that the bankers have got caught
up in this. All I can do is try to put
it right.’
Not for the first time in the
interview, he stresses his background
as a retail banker –
seemingly forgetting the chequered
record of high street
lenders ripping off ordinary

He said: ‘What happened is
banking went global – it got complicated
with derivatives et cetera
– all those things I’m not involved
in. That’s where the world made
some mistakes.’

On ‘fat cat’ pay Kersley is on a
much surer footing.
He received a basic salary of
£200,000 last year – the same as
England striker Wayne Rooney
earns in a week.
On top of this he received just
over £30,000 in pensions and
other perks and is in line for a
performance related bonus,
which is thought to be less than
Although a huge amount of
money in any ordinary person’s
terms, it compares with a package
of around £17m last year for
Bob Diamond the former boss of
Barclays and nearly £8m for Stuart
Gulliver at HSBC.
But Kersley refuses to take the
bait when asked if pay in banking
has got out of control.

‘Tell me a sector where some
people aren’t well paid. I might as
well turn around and say I don’t
think Wayne Rooney is worth
£200,000 a week. And I don’t.’

He adds: ‘I think I’m paid sensibly
for the job given I’m the CEO
of a business. The day I start worrying
about who gets paid what
elsewhere it’s wrong and sad – I’ve
never lost one second of sleep
about it.’

The Geordie – who is based in
Chester and possesses a Mancunian
twang – could have taken a
very different path.
As a semi professional footballer
who played for Macclesfield,
Burton Albion and Stafford
Rangers, he was offered a full
time contract at Bury in 1979.
He turned it down because he
was doing his banking exams and
was due to marry the following
The decision is described wistfully
as ‘one of those “I wonder”
moments’, but Kersley insists he
has no regrets.

‘I enjoyed ten
years of semi pro football. I played
in the FA Cup but never got past
the first round. I also played Liverpool in a
friendly when Ian Rush [the club’s
all-time leading goalscorer] had
just been signed. They beat us

Kersley, married to history
teacher Fay, has long since hung
up his football boots and now
plays the more sedate game of
golf – perfect for plotting how to
win over MS’s loyal

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