Hard Choices: Vernon W. Hill Jr.

(Correction: The number of pounds raised has been corrected to 51 million in the fourth paragraph.)

In 1967, I went into real estate development and found sites for McDonald's (MCD). Watching how they made money off Cokes to how they treated customers had an impact on me. I wanted to bring that experience to banking. When I opened Commerce Bank (CBSH), in 1973, our entire model was about making people happy so they'd give us more business and bring in their friends. That led us to providing coin machines, treats for dogs, better hours, and things like that. We just applied Retailing 101 to banking, and the venture grew to $50 billion in assets.

In June 2007 I got into a fight with regulators and left the bank. Back in the old days, we'd had some transactions with businesses owned by my family. It had all been disclosed and examined, but it became an issue. It was also time for me to leave.

A week after I left, I got a call from Anthony Thomson, who was running a group called the U.K. Financial Services Forum. He wanted me to bring the Commerce model to London. Everyone said this would be the first new High Street bank since 1830. The Brits hate their banks—the customer-dissatisfaction percentage scores for the major banks are in the forties. So I was intrigued.

It took almost three years to open our first Metro Bank branch. In September 2008 we had our capital raised on a Friday, and Lehman failed on Monday. Our investors went up in the air, and we had to basically start again. It would have been easy to give up at that point; what kept me going was the opportunity. People didn't think you could deliver great service and make money, but you just have to get your staff used to the idea that the customer comes first. We opened our first branch in July, and we want to open 200 in greater London by 2020. We've just raised another 51 million pounds to accelerate that rate.

It's hard to get people to switch banks, though the crisis has made that easier as our rivals are forced to scale back. The key to making any decision is to start with the answer. Once you know what you want, you just have to figure out how to get there.

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