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Anita Bunk
Head of Communications

How Banks Create More Trust

Bosch Software Innovations Bank Expert Survey: Stock purchasers trust banks more when they have control systems in place for their investment advisers' own trading.

Immenstaad (Germany), 12/09/2009 -

Not all German banking customers put their complete trust in the stock recommendations made by their bank’s investment advisers. That fact is revealed in new results of an online survey by Bosch Software Innovations, a leading German supplier of a Business Rules Management platform and solutions for the finance industry. According to that survey, 58 percent of respondents said their investment advisers sometimes recommend stocks based on their own advantage, not the customer’s. In fact, 37 percent were convinced that advisers did this as a rule. In contrast, only 5 percent of those surveyed believed that their advisers always gave them completely disinterested advise.

Bank advisers enjoyed greater credibility when the bank monitored its employees’ personal financial transactions. According to the survey, 85 percent of those surveyed would feel more secure if their bank used that kind of software solution. For no less than 21 percent, such monitoring would be a critical element in establishing greater trust.

Walter Pitz, a member of Bosch Software Innovations GmbH’s management, commented, “This survey reflects the concerns of bank customers that have been fueled by the current financial crisis. It is all the more important now for banks to document and scrutinize employee trading for their own account. This involves not only its monitoring function but the reputation of the bank itself. Solutions that monitor employee trading create transparency while protecting employees from jeopardizing their own careers.”

Software solutions like MAID (Market Abuse Insider Dealing Detection) automatically document and monitor potential conflicts. As soon as an employee is involved in a potential conflict of interest, MAID takes note of the situation. This includes transactions that employees make through other banks. Possibly questionable transactions can be cleared up ex ante. This solution creates security for banks and for their employees – and builds customer trust as well.