The Bank of Scotland were concerned at their limitation as a bank only operating in Scotland – the question was how to fund a branch network extending into England and how to attract English clients?. While other banks had experimented with opening branches in key towns, the management did not see that this could lead to the scale of growth required.
SAMI was invited to lead a study which involved most of the senior management and a number of brainstorming sessions. These identified three major planks for any strategy:
Recognition of the trust in Scottish “canniness” in finance by people in the whole of the UK and wider. This has deep historic roots and more recently was epitomized by Scottish Widows, etc
The telephone banking model (recently launched for insurance by Direct Line) would work for banking. This allowed Bank of Scotland to offer bank accounts outside its Scottish heartland to targeted groups who would be wiling to use the telephone as their prime mode of interface, backed up by post.
Partnership working, leading to a partnership with Sainsbury’s to create Sainsbury’s Bank. This uses Bank of Scotland’s back office process capability combined with a massive retail footprint across southern England.
The Bank of Scotland continued to explore ways of extending its footprint in England, and is now part of HBOS, having merged with the Halifax Building Society.