The elder generation might bath in fond memories of BOB Slips and BOB Saving Cards used years back, when First National Bank was an insignificant member among banks like Trustbank, Volkskas, United and Allied. Although not the oldest bank in South Africa as stated on their webpage – that was Lombaard Bank – it still dates back to 1938 and became a division of First Rand Limited in 1998, halfway during the 2-year-long investigations into the bank about ZAR 26bn stolen from the government during the apartheid era. The investigators claimed later that FNB unlawfully received hundreds of millions of Rand from SARB. The money was disguised as ‘lifeboats’ for covering bad loans and until to date those stolen funds have yet to be recovered.
While some of the other large banks in South Africa merged to become ABSA Bank (Amalgamated Banks of South Africa), FNB remained independent and became one of the “Big Five” banks, but first without leaving any impression worth to remember.
The GOOD: Michael Jordaan Era
Major change came to FNB after 2004, when – the only 36 year old – Michael Jordaan became the CEO of FNB and started to turn that ancient institution into the most innovative bank in the world, winning awards to this extent in 2011 and 2012 after having launched unique banking apps for smartphones and tablets. FNB became unstoppable, introducing “Switch” to change from any other bank to FNB by the push of a button and became really well known across societies via radio and social media through the fictitious character “Steve” appearing in ads and clips and Michael Jordaan – short known as MJ – chatting to over 30 000 followers on Twitter.
The popularity of FNB peaked in 2013 and a decade of fame and innovation that brought us eBucks, eWallet and GeoPay came to an end when the new CEO of FNB, Jacques Celliers, took over from Jordaan in 2014. Who would have thought that this would be the beginning of an end to fame, especially since it seemed everybody was now banking with FNB.
The BAD: Jacques Celliers Era
Celliers was different from Jordaan, not interested in innovation but utilising the “toolset” left behind by Jordaan as clearly confirmed in his interview in July 2018 at GIBBS Business School. He confirmed our worst suspicion where he believed it to be a “given” that people hate banks and that the modern banking platform could and should be “abused” down to having a button for dating services identifying rich matches…. But why did he say that and why is it the truth?
Celliers is only interested in profits and the only innovations under his reins are the new ways in which to milk that enormous herd of customers Jordaan had attracted and with his departure entrusted to Celliers. FNB’s profits continued to grow, last by another 16% in 2018 because FNB decided to eliminate customer service and no longer to provide educated, experienced and hence expensive banking advisors and consultants.
The UGLY: Epic Service Failure
Into SA had banked for years with FNB and brought hundreds of small, medium and large companies from overseas to FNB, mostly investors and subsidiaries of multi-national companies. The elimination of service and its consequences, which were experienced right across the group as well as their clients, started to being documented step by step and are now serving as testimony to the further development of FNB.
For the average, single account client, FNB’s step was almost invisible when gradually changing over to vertical competence centers, where the individual customer could not reach the decision makers and managers behind the scenes anymore, but where he or she was stuck with their “Business Banker” or an unmotivated counter clerk at the branch. In both cases a person difficult to get hold of as both positions were assigned to hundreds – if not thousands – of customers. FNB trusted that most people would use the digital platforms – in order not to get hit by high fees – to try and solve their problems. But for the customer the exception became the rule, the consultants mostly unavailable, almost every attempt to contact via mail answered with an auto-reply and when attempting at a bank having to queue for hours without getting a competent dialogue partner in the end.
For the Into SA Group, we were assigned and thereafter stuck with FNB Business Banking Tshwane’s “Business Client Portfolio Executive” and her “Client Portfolio Analyst” and we stopped counting the “Out of Office Replies” after having received the first hundred. Why we needed them? Because almost simultaneously with the departure of Michael Jordaan the problems with the digital banking platforms started. Unauthorised password resets, accidentally erased banking platforms, accidentally cancelled credit and debit cards, extensive downtimes of online banking started to cripple Into SA’s and their clients’ businesses as not a single competent representative of FNB was available.
In 2016 the service failure found its peak when FNB botched up a transfer of beneficiary files, which ended in all online banking beneficiaries having the same file name and therefore had to be entered manually (!) as FNB was not able to restore its own database. Endless hours of data capturing internally at Into SA were met by silence from FNB until September 2016, when Into SA’s Management decided to record all incidents since 2014 and to transform them into a storybook about the inabilities of FNB to deliver basic services and … handed same over to Carte Blanche.
FNB – of course contacted in this regard – only then made the first contact for months through its Regional Chief Executive Officer and offered to pay a five-digit sum to make the Carte Blanche Storybook going away. Into SA – against our better judgement – took the deal and all former contact persons at FNB were exchanged. To the better? Well, absolutely not as the practice of non-service-delivery combined with increased fees did not only affect Into SA but resulted in endless cases FNB could not make go way. FNB had clearly changed their approach towards unhappy and dissatisfied customers and more apparent, changed the way of dealing with complaints or detected irregularities as the following instances show:
FNB miscalculates eBucks
A businessman from Durban started questioning FNB’s eBucks rewards calculations. They just didn’t make sense. Weeks later his accounts were cancelled and he found himself listed on a secretive banking database operated by SA Fraud Prevention Services. Suddenly, his access to credit dried up, his business tanked and his financial reputation was in ruins.
But not only eBucks was taking flag, the beloved advert character “Steve” started also to suffer from FNB’s replacement of educated and responsible staff as several of the individuals managing the bank’s Twitter account _@RbJacobs_ seem either to lack proper education how to use social media or they are getting their instructions from someone who couldn’t care less about the consequences of their tweets. As in response to a tweet query by _@gormleystuart_ on the whereabouts of the bank’s advertising character, Steve, _@RbJacobs (FNB Guy)_ wrote:
“He’s somewhere in Afghanistan, putting a bomb under a wheelchair and telling the cripple to run for it!”
The social media community tore into his comments and the crosshair was more and more focussing on FNB’s service levels.
But the fall and embarrassing behaviour of FNB did not stop here and while the complaints on hellopeter.com were on their way to reach 23 000 by the time this article was written, FNB went received more and more media attention for failed service delivery and overcharging.
FNB overcharges for Non-compliant Islamic Accounts
FNBy Islamic Transact Account was launched and offered to the Muslim community to be able to bank in compliance with Sharia Law and a higher fee charged for that “service” until more and more Muslims started complaining about the unjustified fees for an account that actually does NOT comply with Islamic Banking, by earning interest for example. In similar incidents FNB started now a new practice by just closing the accounts if someone complains, which seems to have let to a general policy to cover for the missing quality service bankers and the apparent shortfall in service delivery.
FNB terminates Accounts without Reason or Notice
Between 2018 and 2019 Into SA and their clients started again to experience failure in delivery, not even nine months after the previous settlement. Access rights were erased, password authorisations blocked and access via the app deleted. Complaints were dealt by a junior IT representative from FNB, who spent hours and hours at our offices to fix banking platforms and lost access data while banking for us and our clients came to a stand-still. After whole salary payment batches were erased – irretrievably – and FNB did not even respond to any request around eWallet anymore (reversal of deposits and missing back-up passwords), it was time to summarise and address the service desert yet again. But this time there was no response or resolution attempt, which proved the news about FNB’s new policy: From the Into SA Group via Non-Profit Companies looking after the homeless or skills transfer programmes in Soweto to private customers, even elderly couples and independent BEE Engineering Start-ups, FNB terminated dozens – if nit hundreds – of accounts over night without any comment, in some instances even without notice. But if you think this is already a behaviour not befitting any bank, read what reason was given after FNB was contacted and took the time to answer:
Good Day Sir,
Thank you for your email below.
Kindly note, the duty to provide reasons for conduct is one imposed by administrative law on a public authority exercising public powers. As a commercial bank FNB’s relationship with its customer is not governed by administrative law, but the private law of contract. FNB therefore has a contractual right to close the bank accounts on reasonable notice. Where FNB elects to exercise its right (on reasonable notice) FNB’s motives for exercising its contractual rights are irrelevant.
As such there is no legal obligation on FNB to provide reasons for closing the bank accounts.
Can it get more arrogant? Can it actually get worse?
Yes, as after the termination of accounts all credit balances were frozen and it took FNB a whole 10 (ten!) days and being threatened with urgent interdicts through the Pretoria High Court to transfer the credit balances to new accounts while in the meantime not even answering any communication by the legal representatives of the Group and their clients. This is what happens when you get on the wrong side of FNB today. FNB still thinks they can get away with it, but the tides are turning.
FNB charges more for Home Loans of Black Customers
While Muslims seek class action against over-charging for non-compliant Islamic Banking and the Into SA Group and their clients are preparing for their own class action against FNB, SABC broadcasted a Special Assignment about Cape Town-based usury expert Emerald van Zyl, who is currently asking the Cape Equality Court to rule that FNB’s FirstRand Finance Company discriminated against more than 4 000 black customers by charging them 30-40% (!) more than white customers on their mortgage loans. The total claim is likely to exceed ZAR 3 billion.
If you still wonder, why Michael Jordaan is back with his ZERO Bank, why new banks like Discovery, Thyme and African shoot like mushrooms out of the cloud, you know now why and we can only warn you and at the same time urge you to follow our client’s example and terminate your accounts with FNB before you suffer any of the above consequences….But be prepared: FNB might not answer you request for account closure, as then they can continue to charge you their excessive fees to enable their CEO to continue to brag, how profitable his bank is!