AM Online

Bank of Scotland to drop Capital Bank Motor name

Capital Bank Motor is to be renamed Bank of Scotland Dealer Finance on December 4 as part of a programme to try to retain its market share “in a time of uncertainty”, said managing director George Grant.

“It is a clear indication of Bank of Scotland’s commitment to the sector,” said Grant. “The name Capital Bank Motor has never had any clear benefits in marketing terms. We told some of the larger dealer groups about the possible name change, and the reaction was positive.”

The news had a mixed welcome from dealers contacted by AM. Tony Roberts, managing director of Magna Motor Company, said: “Capital Bank Motor is an efficient and decent company, and I doubt whether the change of name will make a scrap of difference to its fortunes.

“It isn’t as though people reach for Yellow Pages to discover it – dealers are aware of the business. It sounds to me like a case of corporate vanity more than anything – the new name would not influence me either way.”

John Cleland, owner of Cleland of the Borders, said: “There could be some value in using the Bank of Scotland name to give customers confidence following Northern Rock’s problems. “But some retail buyers who are Bank of Scotland customers may be tempted to wonder whether they can get a better deal by going direct to their bank.”

Grant believes finance companies and dealers can start to halt the drift of point-of-sale business to high- street and direct lenders.

New legislation will help in 2008, he said. Global changes to banking regulations mean companies providing personal loans will need to have larger financial resources to cover them than those – such as manufacturers and dealers – offering HP, PCP and contract hire packages.

“The crunch is coming for supermarkets and other direct lenders. They have offered loans at keen prices but I expect them to charge more next year,” said Grant.

In 2006, dealers earned £131.8m in commission from Capital Bank Motor. This year, up to mid-October, the total was £100.5m, and Grant expects that to rise to £133m by the end of the year.

The total should grow after the reorganisation, but Grant would not give forecasts. He said his company was totally committed to supporting the Finance & Leasing Association online training programme and all his staff had successfully completed it.

“We needed to do that before encouraging dealers to get their staffs to,” said Grant. The bank was making “a significant investment” in a computer system that would enable dealers to get faster responses to loan applications.

“It will also give us the chance to be more flexible, which is important in today’s market,” he said. Bank of Scotland Dealer Finance will have a new staffing structure so that the team spending time with dealers does not have to think about new products.

If you are not a registered user your comment will go to AM for approval before publishing. To avoid this requirement please register or login.

Comment as guest

Login  /  Register


No comments have been made yet.