Is loyalty to your bank all it's cracked up to be?

Yorkshire Building Society announced on Monday that it is takingover the Egg brand, as well as all the savings and mortgagecustomers of the online bank. It's a good move for the Yorkshire anda good move for the remaining customers of Egg who will become partof a mutual (the credit card users were sold off to Barclaycardearlier this year).

But it raises questions about financial brands. Do they meananything at all? Are the millions of people who remain loyal yearafter year to their bank or insurer just being foolish? Sure, manydon't switch because it's easier not to, but there are also manypeople who choose to stick with the same financial firm that theymay have been with for years, even decades.

Take Egg. It was originally set up by the Prudential in 1998 andaggressively marketed as the UK's first internet-only bank to techno-savvy savers and borrowers. The brand was specifically launched toride the then internet revolution. So what sort of people do youthink it attracted?

Those who considered themselves, smart, ahead of the curve,maybe? Or were people simply lured in by the online bank's thenleading savings rates? It was hugely successful in its time,attracting around three million customers. Any who joined then andhave remained at Egg must feel a little bemused about what became oftheir exciting brand.

Prudential ultimately didn't want it and neither, as it turnedout, did Citigroup, which bought it from the insurer in 2007. To befair to Citi, whatever hopes it may have had for the brand to beused as leverage to build up a significant UK presence werescuppered by the credit crunch, when the mighty American bank itselfhad to be bailed out by the US government.

Since then Citi has been looking to unload Egg, trying to sellthe whole business last year with no success. It sold the creditcard part of the business in March to Barclaycard - whichunsurprisingly turned down the opportunity to buy the Egg brand,preferring to migrate customers on to its longer-established brand.

So what now for Egg? The Yorkshire already has a multi-brandstrategy keeping the names of the building societies it has takenover in the last couple of years - Barnsley and Chelsea - eventhough the branches are now effectively Yorkshire branches. It plansto do the same with Norwich & Peterborough, assuming it gets memberagreement to take over the society next month.

That strategy makes sense when you're dealing with decades oftradition, but the same is clearly not true of Egg. The society saysit is yet to decide whether to keep the brand but there are somereasonable arguments for doing so.

But even if Yorkshire does decide to scrap Egg, should we mournit? Do its customers actually care whether their accounts are run bya building society, a bank or an insurer? That begs the question whyso many of them have remained with Egg when it's been a long timesince its savings and mortgage accounts were regularly featured inthe best-buy tables.

Some stay simply because of inertia. But there must be others whohave remained loyal to Egg. But why? The price of their loyalty caneasily be calculated. How much extra interest - or how much cheapera mortgage - could they have got elsewhere? That's a question to askwhether your account is at Egg, or another financial brand. If youwork out loyalty is costing you more than a few pounds, it's time toswitch.

s.read@independent.co.uk

DONATIONS

Entertaining way to give to charities

TOY STORE The Entertainer has become the first high streetretailer to sign up for the Pennies scheme, which asks shoppers toround up purchases to the nearest pound at tills and hand over extrapennies to good causes.

The scheme, which is already available online at Domino's Pizzaand Travelodge, as well as in Zizzi restaurants, has so far raised136,000 for 18 UK charities. Most donations are 10p or less.

Cash raised by The Entertainer will mainly be shared between fourchildren's hospitals: Alder Hey Imagine Appeal; BirminghamChildren's Hospital; Wallace & Gromit's Grand Appeal, which raisesfunds for Bristol Children's Hospital; and Great Ormond StreetHospital Children's Charity.

The scheme is a simple and painless way to support charities asdonors do not need to give any personal details but simply press abutton on the store's chip and pin machine when prompted. The toystore reckons the scheme could raise around 100,000 a year fromgenerous customers.