Bankers stress bankers with commercial pressures. Fabi report

18 May 20222 years ago babelfish

What Lando Maria Sileoni, secretary general of Fabi, said in a hearing at the parliamentary commission of inquiry on the banking and financial system

Thank you, on behalf of all of Fabi.

We have always been the most representative trade union in the ABI, BCC, tax collection and retirees sectors with almost 120,000 members. In 1949, I want to remember, Fabi signed, alone, the first national banking contract. It is the right occasion for an important study on distribution models, on undue commercial pressures, on the change of the business model and on the social role of banks. Undue commercial pressures have been relegated, confined, isolated and considered by some banking groups as an exclusively trade union issue only for the political will to hide, instead, a social problem.

The obsession of the banks is the achievement of results, all concentrated in the short term, because the real goal is only the distribution of very high dividends to shareholders and investment funds. I do not believe that a clear separation between the investment bank and the commercial bank can be used if the only goal is to distribute high dividends. The political transition is not insignificant because, after the recent scandals of the so-called “betrayed savings”, the undue commercial pressures, instead of decreasing, have regained strength. We filed complaints at the Popolare di Vicenza on the subject of “betrayed savings”. In return, I received a trial and a claim for damages for € 200,000. We were fully acquitted, but this case demonstrates how opposed we were to that management.

I want to guarantee a contribution to try to change, together with you, a paradoxical situation. My contribution seeks dialogue through a series of proposals that I will make at the end, for an overall improvement of the banking sector. One of the priorities today is to start real financial education from schools.

It is essential to get the message across that banks are rapidly transforming from branches and agencies into financial shops, with massive technological investments to then transform themselves into a Fintech, that is financial companies with few staff and with a high rate of technology. This is unacceptable to us. It is essential to convey the message that less and less credit, fewer loans will be disbursed to households and businesses, not by chance or by negligence or by indifference of the banks, but by a precise political will on the part of the European Central Bank.

This decision by the European Central Bank starts a long time ago, since in 2015 the Italian banking sector reached a record of 200 billion euros in bad debts that banks over the years have had to sell off, for a few euros compared to the real value, to independent companies. credit recovery, some of which are extorting citizens, families and businesses with the desire to repay the credits purchased by banks in a very short time. This decision by the European Central Bank increases the distance between economic-financial power and political power. From a research of ours in 2021, taken up by national television and the press, it emerged that banks make more money by selling financial and insurance products than by loans.

When I talk about the social role that banks have long neglected, I am referring precisely to situations like these, where, once upon a time, the bank had its own legal department that dealt with repaying credit and saving the customer, avoiding bankruptcies. companies and businesses. Today, entire families are pushed into the hands of usury under the pressure of some debt collection companies. In Parliament lies a bill to regulate such an unfortunate situation that affects 1.2 million people. I also want to remember that when, in 2015, bank non-performing loans reached the record figure of 200 billion, the Bank of Italy and us like Fabi emphasized that the majority share (70% of the total) referred to large debtors; over 15 billion bad loans were attributable to just 39 positions. Thus a doubtful and equivocal relational system was also highlighted which, at the time, concentrated loans in the hands of a few subjects.

In the rest of Europe, bank employees do not suffer certain treatments and in fact there are no precedents on the subject of so-called betrayed savings. The social role of banks is guaranteed by those banking groups in the country that undoubtedly promote solidarity activities, finance non-profit organizations, foundations, research bodies, hospitals with important economic interventions, donations, subsidized loans. These are all initiatives that make it possible to achieve important social objectives. This aspect, however, precisely because of its importance and delicacy, deserves additional consideration and concerns the true value of charity compared to the political weight that is automatically obtained in many areas. This message, coming from non-union circles, a message that we do not share, that there is a certain indifference on the part of important state bodies there is a certain indifference towards banks and undue commercial pressure on their employees cannot pass, precisely because the banks themselves tend to to intervene economically where the state fails.

In 2017, for the first time, ABI and trade unions signed an agreement on undue trade pressure. The results are struggling to arrive and the main reason is one: most of the agreements signed within the groups, to improve and adapt the national agreement to the individual companies, have been repeatedly rejected by the banks themselves, by the same companies that , in some cases, they refused to guarantee the anonymity of their employees' reports. Politically, banks have always opposed this deal because they don't want controls by internal unions. In many cases, it would be sufficient to intervene promptly on the territories at the first hint of undue commercial pressure to resolve at least half of the situations. This does not happen. And another argument, which is making a negative difference, is that in recent bank mergers the effective integration between executives from different banking groups gives rise to unbridled individualism for professional and career interests, creating difficult and incomprehensible communication problems. of prevarication and respect towards all staff. Furthermore, another element underestimated by many is the obsessive competition that characterizes the relationships between the banking groups themselves.

I formally submit a dossier of hundreds of pages, based on the size of each group, containing all the complaints, the "unitary" reports of the basic trade union representatives – which I fully and completely agree with – those that are in daily contact with the workers, who are not full-time trade unionists, but who operate and work in agencies, in branches in contact with customers. Here I list the most sensational cases of undue commercial pressure which, I want to emphasize, have often forced female and bank workers to use drugs or to seek the assistance of psychologists and psychiatrists. The cases are very numerous and widespread and are systematically denied by some commercial managers of banking groups. Here, as I said, are some examples: budgets that are difficult to achieve are assigned, with professional and personal retaliation in the event of non-achievement (verbal humiliation, threats of transfer or threats of revocation of holidays or part-time); employees are prompted several times to send sales reports (daily and weekly) and future sales forecasts are requested on the various products; appointments and the agenda with customers are monitored through the company intranet, and employees are obliged to indicate, at the beginning of the day, the sales objectives, with subsequent verification at the end of the day; new appointments are made with customers without the knowledge of the worker; e-mails, sms and WhatsApp messages are continuously sent, even with harsh and disrespectful language; groups or chats are created by the sales management, with the sole purpose of monitoring the results, to further push sales; the periodic and systematic survey of the sales data is carried out, not only to monitor the commercial performance of the bank, but to check the individual results with consequent damage to the personal dignity of male and female workers; "tournaments", competitions or challenges between territorial areas or branches are organized which end with the publication of rankings and publication of sales data, also with the indication of the names of people, branches and areas to which they belong, to comparison of employee results.

The European MiFID directive is the legal pillar for the protection of banking customers to whom financial products are offered. For the bank, it should be essential to ensure that the customer has fully understood what he is investing in and above all what risks he is facing with a particular product or investment. Unfortunately, very frequently the top management of banking groups and those who manage the commercial networks of the same banks create mechanisms that allow customers to be given only misleading or inaccurate or partial and deceptive information, when in reality the Mifid directive requires that you always provide clear and correct. Even the training of banks for their staff is lacking on this fundamental directive, which often occurs even after the launch of new products.

As for the protection of savings, Mifid itself provides a questionnaire for customers, but bank employees are sometimes obliged to suggest answers in order to assign customers "financial licenses" in line with the products offered. Therefore, it happens that complex and risky products are sold to those with limited knowledge of risks and even to those who have never made financial transactions in the past. In short, the banks, formally in good standing, force their employees to take other paths with the result that it is not just the customers who take risks, but the employees themselves. This mechanism tramples on any ethical principle because the engine of financial advice is only to increase the bank's revenues. Starting from Mifid, I arrived at the subject of bonuses and the so-called incentive systems: all banks use variable remuneration both to retain and to motivate employees. This is the theory.

In fact, the rewards have become, especially in the sales network, only a push to increase the commercial pressures. This happens – and we have ascertained it – because the sales targets assigned to male and female workers are unrealistic, often impossible to achieve, but they represent elements that are then used to evaluate their daily work. Even the prizes should follow ethical principles, but those that are advertised by the top management of the banks are used only for propaganda and communication initiatives; in reality, incentive systems are only means that end up favoring conflicts of interest, destroying team spirit in work groups and creating unequal treatment between employees. I want to recall what the governor of the Bank of Italy, Ignazio Visco, said on September 18, 2021: "The integrity of the conduct of banks has been questioned under various aspects, from honesty in the behavior of bank managers to the ability to manage financial risks that are often excessive, from the commitment to look after the interests of customers to attention to the system of perverse incentives associated with bonuses and remuneration ».

These are our proposals:

1) the commercial results condensed in the short term must instead be extended in the medium-long term;

2) for the sharing of incentive systems, the national, company and group trade unions must be involved;

3) serious and true training of all personnel must be guaranteed;

4) the sales policies must be calibrated on the actual characteristics of the customers;

5) provide for legal provisions that allow the control and sanction of non-compliant banks, even those that do not respect the agreements signed with the trade unions.

Heraclitus, a philosopher of ancient Greece, argued: "There is only one wisdom, to recognize the intelligence that governs all things through all things, because hidden harmony is worth more than what someone wants to make appear".

Thank you for listening to me.

APPENDIX CASE STUDIES UNDUE COMMERCIAL PRESSURES

Difficult budget assignments and requests for future sales forecasts on various products.
Professional and personal retaliation in case of failure to achieve (verbal humiliation, threats of transfer or threats of revocation of holidays or part-time).
Calls during business hours for the placement of insurance and financial products.
Various solicitations for sending sales reports (daily and / or weekly).
Obligation to indicate sales objectives at the beginning of the day and subsequent verification at the end of the day.
Monitoring of appointments and customer agenda through the use of the company intranet.
Entering new appointments with customers without the knowledge of the worker.
Remote control of the number and duration of telephone calls for telephone consultants.
Control in the presence of telephone calls to customers during which insurance and financial products are offered to customers. § Telephone listening to sales proposals.
Continuous e-mails, sms and WhatsApp messages, even with inappropriate and offensive language.
Creation of groups or chats by the sales management with the sole purpose of monitoring the results and encouraging sales.
Periodic and systematic survey of the final sales data made not only to monitor the commercial performance of the bank but the individual results (damage to the personal dignity of workers).
Organization of "tournaments", such as competitions or challenges between territorial areas or branches which end with the publication of rankings and publication of sales results as well as with indication of names and branches / areas to which they belong (comparison of employee results).
For those in smart working, I invite you to sell and produce more just because you work from home.
Invitation to work overtime (even unrecognized) to reach the sales budget.

Other incorrect behaviors

Launch of new products and invitation to sell without the prior and necessary training of workers.

Training on the sale of new products carried out in extra working hours.

CRITICAL ASPECTS IN INCENTIVE / REWARD MECHANISMS

Meritocracy matters little: in the assignment of objectives (quantitative and qualitative) the interest in the products sold to customers, the performance, profitability and financial success of the bank prevail.
The criteria for assigning the objectives are often selective (because the objectives are challenging) and the efforts are not rewarded but only the results.
The quantitative objectives may concern collection, financing, managed assets (funds, insurance, etc.), the number of new customers acquired, but for some products specific objectives are envisaged (for example in the insurance sector) to push the sale.
In evaluating the objectives, the quantitative aspect (more customers, more products) and the qualitative aspect (eg: quality of acquired customers, low level of money laundering, low overall risk, credit quality) always prevails; In this way, the rewarding system draws little inspiration from ethical principles or only in words and not in deeds.
Both group objectives and individual objectives are envisaged, but the contribution of each employee to the achievement of commercial results prevails over that of the group: little attention to team spirit.
The fact that the verification of the functioning of the incentive systems is entrusted to the personnel function represents a conflict of interest.
The presence of different levels of rewards (eg basic, additional and excellence) creates more competition and pressures, exasperating them.
The highest bonuses are not always recognized even for employees with low salaries or lower roles; this mechanism can create inequalities between employees.
Sometimes the bonuses are awarded only to employees with permanent contracts: in these cases, the conditions of access to the bonus do not allow compliance with the principle of equity among workers; in some cases there is a reduction in the premium or bonus for women who have taken advantage of optional maternity leave.

This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/i-banchieri-stressano-i-bancari-con-le-pressioni-commerciali-report-fabi/ on Tue, 17 May 2022 10:00:36 +0000.