Financial advisors surveyed for this year’s Report Card on Banks and Credit Unions were less than impressed with their deposit-taking institutions, rating their firms lower overall in performance year-over-year in 29 of 36 categories, with ratings for key categories such as “firm’s total compensation” and “bringing new investment products to market” down by half a point or more.
“The salary is too low and too reliant on commissions,” says an advisor in British Columbia with Toronto-based Canadian Imperial Bank of Commerce (CIBC).
Adds an advisor in Atlantic Canada with Toronto-based Bank of Nova Scotia: “They have to make my job more attractive through increased compensation because we have many advisors retiring, and there’s less interest in these jobs than there used to be.”
To obtain the Report Card’s results, Investment Executive (IE) researchers Justin da Rosa, Tessi Sanci, Dane Taylor and Jeff Wimbush spoke with 348 advisors at six banks and two credit unions. (St. Catharines, Ont.-based Meridian Credit Union was added to this year’s Report Card.) Advisors were asked to provide ratings for their firm’s performance in each category and for the importance of that category to their businesses.
The ratings for the 36 categories in the Report Card were based on a scale of zero to 10, with zero meaning “poor” or “unimportant” and 10 meaning “excellent” or “critically important.” Individual ratings were then averaged for each category for the firms individually and for the Report Card overall. In addition, the “IE rating” is the average of all categories for each firm, excluding the “overall rating by advisors,” which is how advisors rated their firms overall out of 10.
A closer look through these ratings reveals that three of Canada’s major banks – Toronto-based TD Canada Trust, Montreal-based National Bank of Canada and CIBC – are struggling to keep their advisors satisfied; these advisors rated their firms significantly lower in a variety of categories this year.
National Bank saw its ratings decline in 31 of the 36 categories, with 16 of those dropping by half a point or more.
No public image in English Canada continues to be an issue for National Bank advisors, who say the bank has not built up its brand throughout Canada in the manner that it has in its home province of Quebec. Last year, the bank managed to see an improvement in its rating for the “firm’s public image” category; but over the past year, that rating has since dropped back to its 2011 score of 7.8 vs 8.5 last year.
“The bank doesn’t have a poor image,” says a National Bank advisor in Ontario, “but it lacks an image outside of Quebec.”
A colleague in British Columbia praised both the job stability and the benefit package at National Bank, but said he would not recommend the bank as a place to work because it lacks a public image outside Quebec: “We need a stronger advertising focus out West, as well as more branches.”
CIBC saw its ratings drop in 28 of the 35 categories in which it received a rating, with 13 of these scores dropping by half a point or more. Many advisors were frustrated with the firm’s outdated technology and the lack of support in the back office, in particular. (See stories on pages 18 and 20.)
“They’re taking away support in the back office, and that’s a mistake,” says a CIBC advisor on the Prairies. “They are creating more work. If somebody goes on disability, they’re not replacing them. I think it’s going to harm the bank if they keep going with it.”
Adds a colleague in Atlantic Canada: “The technology is just awful. It’s a DOS system, and we’ve been told it’ll change for years. They are saying it will happen this year. We have new advisors who don’t even know what DOS is.”
Much like CIBC, TD also saw its ratings drop in 28 of the 35 categories in which it received a rating (13 of those by half a point or more). However, some of these ratings seem to have reverted back to 2011 levels after they saw significant jumps last year. These categories include compensation, “back office and administrative support” and “firm’s marketing support for advisor’s practice.”
Overall, TD continues to excel, as it garnered the second-highest IE rating in the Report Card. TD’s advisors continued to praise the bank for its stability and strong strategic focus.
“TD provides a fun work environment with a clear strategic direction,” says a TD advisor in Ontario. “The focus is very customer- and employee-centric.”
Another firm lauded for its strategic focus was Edmonton-based Servus Credit Union Ltd., with an advisor in Alberta noting that this focus is “clear and shared with the entire organization.”
Servus saw improved ratings in 20 of 35 categories in which it was rated, with eight of those improvements being by half a point or more.
One of the major strengths that advisors at both Servus and Meridian spoke about was the commitment to a corporate culture focused on creating a “family-like” environment.
“They’re very laid back, especially compared with the banks,” says a Meridian advisor in Ontario. “They focus on members, as opposed to driving shareholder profits.”
One category in which all the firms in the survey excelled was the “firm’s diversity and inclusion strategy.” With an overall average performance rating of 9.1, up slightly from 9.0 last year, this category received the second-highest rating in the Report Card this year. (IE explores this topic in a web-exclusive story on www.investmentexecutive.com.)
Firms were praised for providing flexible work arrangements, setting up diversity leadership councils and training programs regarding minority groups for both employees and management.
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