[dropcap]T[/dropcap]he business crisis between Innoson Motors and GTBank began in 2011, according to statements released by lawyers to Innoson Motors. The main issue was about unlawful and excess deductions on overdraft charges on Innoson Motors Account by GTBank to the tune of over N786m, in the opinion of Innoson Motors. GTBank is reported to have disputed that sum to the value of N559m, which reduced the earlier claimed illegal deductions on Innoson Motors by over N200m.
The mutually agreed unlawful deduction of more than half a billion naira by GTBank on Innoson Motors is by no means a meager sum. This is where GTBank would have counted its cost, cut its losses and capped its liabilities. But no, the bank would have none of that. It drew itself into an unnecessary crisis over the value of the percentage of interest to be repaid in refunding the illegal deductions on Innoson Motors.
While Innoson Motors had canvassed for 22% as was the value of all loans taken by the company from GTBank, the bank declined on that, insisting that the value of interest on the refund should be 7%. Following the unresolved issue, Innoson Motors approached the courts in 2012 to do justice to the matter, which unfortunately was the beginning of a legal tussle that would also be GTBank’s tortious route to infamy.
It is not surprising that in 2017, 5 years later, GTBank would be losing customers as a result of how badly it managed its business relations with one customer, to whom it would not only be indebted to by over N10b but would be defending a N400b suit instituted by him against the bank.
WHAT DID GTBANK NOT GET RIGHT?
1. Good Brand Positioning Vs. Sharp Business Practice
GTBank has spent millions naira on its being a customer-friendly bank driven by technology and strong values for the upwardly mobile. Although the bank had sustained its brand positioning for decades, it took one customer to bring it to rubble by proving that while, indeed, the bank may be strong on tech and offered great service for the upwardly mobile, it lacked considerable business values and ethics. It doesn’t matter whether the bank unlawfully deducted one kobo or half a billion, as claimed in this particular case. What matters is that its brand positioning runs in conflict with its business ethics and practice. With one bad case, a probe may be set in motion for several thousand cases that may have evaded the radar based on the trust placed by customers on the GTBank brand.
2. Refusal to count its losses sooner
Given that GTBank is said to have accepted liability for unlawful deduction to the tune of N550m, which contradicted its espoused values, it amounted to further injury on its brand, that it didn’t settle for the same interest value as it employed in dealing with its customer(s).
For insisting on less than its own interest value and allowing the issue go protracted and getting to court, GTBank presented itself as a shylock lurking on its customers and without regard for business ethics, values or even its own reputation.
Had GTBank counted its losses sooner and dealt fairly with its customer(s), having acknowledged its culpability on the issue by choosing to repay over half a billion naira of unlawful deductions, it would have saved itself the damage of a legal tussle and its currently impaired reputation, not to mention its loss of business.
3. Impervious Silence
The raging storm against GTBank has either not affected its fortune or means anything to its reputation, in spite of the chocking degree of effluvium that it reeks of. That, perhaps, can only be the reason the bank has kept mute on the issue. Nothing will happen. Nothing can go wrong. It is this same attitude of other major Corporate Failures in the past that believed they were too big to fail before they ended up being catastrophic collapses and gargantuan embarrassments.
It is shocking that more than 24 hours after the arrest (and release) of Innoson’s CEO, at the alleged behest of GTBank based on claims by Innoson Motors, the bank is not at the fore addressing issues in a crisis that is not only taking a regional but national dimension.
What GTBank’s silence, in the face of the raging crisis, reveals is that it has no crisis communications strategy in place beyond the fancy and beauty of its violated brand. That it is doing nothing about the issues is as good as doing the wrong things and it’s bound to end up badly due to the up-scaling loss of confidence in its brand.
If the perception is that GTBank rips off its customers through sharp business practices, silence cannot help the brand’s fortune. It must wake up now.
The Implications
The current and future implications of GTBank’s actions, which reasonably pass for a breach of customers’ trust on the brand, are many. In the interim, many more customers will request an audit of their accounts with the bank. If the same principle the bank employed in dealing with Innoson Motors is its policy, which is easy to believe to be true, the bank stands to have much more trouble in its hands than the N400 billion suit it is currently facing in court. If that becomes the case, on a grand scale, it can kiss itself goodbye.
Oraye St. Franklyn, a crisis and strategic communicator, manages MainRave and is currently a Senior Communications Aide to the Rivers State Governor. He tweets from @RealOraye.
The opinions expressed in this article are solely those of the author.
