Financing specialist questions banking institution's customer segmentation

Fri, 13 Apr 2007

A financing analyst has raised doubts about the decision by banking institution HSBC to run a branch exclusively for its highest-earning and highest-spending customers.

This week, it was revealed that the UK's largest banking group was planning to operate a branch in Canford Cliffs exclusively for Premier account holders.

However, Kevin Mountford, head of savings and current accounts at financing website moneysupermarket.com, pointed out that Premier account holders must have a £200,000 HSBC mortgage, £50,000 in savings or a £100,000 mortgage combined with a salary of £75,000.

As a result, Mr Mountford has suggested that the move is a way for the financial services provider to start "driving out less profitable customers".

"Time will tell whether HSBC will regret the snub on its less lucrative customers since they form the foundations of its loyal client base," he added.

"I expect this move to test customer loyalty."

However, HSBC has now responded to criticism within sections of the media about its proposals.

The banking institution has pointed out that the Canford Cliffs branch in question is a small site and that other customers can still use its facilities in Westbourne and Poole, which are one and two miles away respectively.

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