#10: Why did you bring us to social banking, Great G?

What happened before: After their unexpected encounter on a dark, cold night in Toronto, Cheeky C and Great G decided to embark on a journey, each unknowingly with different destinations in mind. Cheeky C wants to discover her identity and purpose, while Great G aims to realize a vision of global health through the world of finance. The next day, they wander through Toronto, hoping to find initial clues. Bewildered, Cheeky C begins to question things that seem natural to us. At the lakeshore of Lake Ontario, she learns some facts about the power of banks and money that she had never considered before. However, it becomes increasingly evident that she has to confront internal struggles as well…

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Our two travel companions head back to Great G’s cozy home and get their backpacks ready (‘Cheeky C, can you take those four packs of cinnamon-chocolate tea, thanks’), then drive to Toronto Pearson International Airport. Great G was able to book an affordable last-minute ticket for two people (‘Call me Great Booking G in the future’). We accompany them as they move through the gate into their airplane to Europe, which will land eight hours later in a place that proudly calls itself ‘Cosmopolitan City With Heart’: Munich (‘It’s actually more like a Cute Village With Heart, I tell ya’). As an invisible audience, we have the privilege of not being as jetlagged as Great Booking G and Cheeky C when they finally leave the airplane.

‘Why did we land here? Where is this place?’ Cheeky C looks around. ‘The blue and white sky is so pretty!’

‘How a proper Bavarian sky should be like… We landed in my hometown, the place where I was born and lived for many years. Munich, a city in the country of Germany.’

‘So you are originally German? What brought you to Canada?’

‘That, my Cheeky Child, is a longer story… I will tell you someday. Let’s have breakfast now. Do you want to have pretzels? We say Brezn. Our next connection flight will depart soon.’

We watch the two as they sit down and eat, both laughing when Great G tries to teach Cheeky C how to pronounce ‘Obatzda’, and becoming quiet when Cheeky C’s eyes close and she falls asleep, exhausted from the journey. Great G guards their luggage, and the small girl curls up in embryo position on the hard bank, with an unfolded paper world map under her shoulders that someone left there in a hurry. It is a peaceful scenery, an anchor of stillness within the hundreds of passengers rushing past them to their flights within the next hour.

We enter the next airplane with them, and together, we arrive at their main destination: Amsterdam, Netherlands. Their journey hasn’t yet stopped. They continue to travel by train to Utrecht, as Great G knows a good friend there who offered to host them in her apartment during their stay (‘She is Indian, Cheeky C, time to increase your spice tolerance…’). Finally, the next day, after a delicious dinner, deep discussions, and a night of good sleep, they reach what Great G is so eager to show Cheeky C: the headquarters of a social bank.

‘And it’s not just any headquarters’, Great G excitedly says to Cheeky C when they leave the train station ‘Driebergen-Zeist’ and walk on the pathway alongside a small, dark green forest. The trees’ branches and leaves are sprinkled with water drops from the recent early spring rain, and the morning air is fresh and clean. ‘It’s art. You will see.’

A building rises in front of them, surrounded by trees and morning fog. Contrary to the banks in Toronto, it is not its size that is the most remarkable characteristic. It is the shape. A curved glass front, not higher than two stories, flows into the nature coexisting around the building. The front connects three round-cornered sections of the building that were built higher than the outer wall, about three or four stories high, covered by greened roofs.

‘My friend must still work in one of these towers right now,’ murmurs Great G. ‘Let me text him to see whether he is available to give us a little tour.’ While she types, Cheeky C looks around, trying to get a glimpse inside the building. Its inner parts are illuminated by warm light. She can see contours of people sitting on desks, walking around, or having a conversation. Making deals that manage capital flows – and move the world. Cheeky C feels a rush of sensations, of fascination.

‘Let’s go inside. My friend said he is available for a coffee in the morning.’ Great G’s voice interrupts the thoughts of the child next to her.

Inside the building, they sit down on a wooden table next to a barista bar and the elegant, transparent walls of the building. ‘He should arrive soon.’

‘Why did you bring us here?’, Cheeky C asks.

‘To enjoy a proper coffee in Europe, we all know the disgusting yet expensive brown broth in Canada… After that, I can die in peace.’

‘You are joking.’

‘Of course I am. I am too great to die. I brought you here to show you that there is something else besides conventional banks and their intimidating, cold, streamlined towers as we saw it in Toronto. Something powerful, authentically aiming at the wellbeing of the planet, society, and the individual. You asked me if there are any kind of banks that can help against a lack of happiness. Here they are: they are called “social banks” or “ethical banks”. Again, the architecture alone expresses certain paradigms and values, as you see right now. What differences have you noticed?’

I brought you here to show you that there is something else besides conventional banks and their intimidating, cold, streamlined towers as we saw it in Toronto. Something powerful, authentically aiming at the wellbeing of the planet, society, and the individual.

‘Well, the building here is a lot less dominating… Rather, it tries to adapt to the needs and habits of people and nature living and coexisting here. But what is social banking? How does it work? And where is the connection to personal happiness you promised?’

‘Question correctly answered. Amazing for your age. Look, the inside is designed after the form of a mushroom. It’s central pillars supporting the ceiling merge in the middle of the building like a trunk. It’s art – the art of synergising natural resources and human creativity. But now it’s my turn to answer your questions.’

Great G looks around, her wrinkled face smiling. She seemingly enjoys where she sits with her young companion. ‘It’s so good to be back, after so many decades. After ending my semester abroad in Canada, I came here to visit friends and just started my own discovery journey through the world of finance… But anyways. To understand what social banking is, we must understand its differences from conventional banking. I give you a striking example.’

Great G types into her phone and turns the screen around for Cheeky C. ‘JP… JP Morgan Chase,’ the girl reads. ‘What is that?’

‘That, my Cheeky Child, is one of the largest and most successful banks in the world.’

‘Oh, so a lot of Beaver Tails can be financed by it?’

‘Yes. I guess we just introduced new metrics for measuring a bank’s success. Amazing… For now, let’s look at one of the usual indicators of a conventional bank’s success, and that’s total assets under management (AUM). It’s important to stress that there are other indicators out there as well, I chose the one that I think is most illustrative for a bank’s power. In simple words, AUM is the value sum of all things financed – ‘owned’ – by the bank.[1]

In 2023, JP Morgan’s AUM had a volume of $3.74 trillion, ranking it the fifth largest bank in the world according to total assets, and the largest bank in the US. In the realm of finance, the bank is widely loved and celebrated for that. It is involved in markets all around the world, and its services are available in many countries, which makes it attractive for many international companies to collaborate with this banking giant.

The bank is like a magnet attracting hyper-capitalistic mega corporations that effectively rule the world to a large extent or those that dream of doing so in the future. It forms a dense knot of Western monopolistic power in the financial system.[2]

In case you ask yourself about the toppers: the four larger banks are from China.’[3]

‘Wow. Sounds like a lot of Beaver Tails. And power.’

‘Yes. And here is the thing… JP Morgan Chase’s money moves a lot of things in this world and keeps them running, but it doesn’t use all of their money power for planetary health and societal wellbeing. In fact, the bank’s harshest critiques say that the bank actively destroys planetary and societal “assets”.’[4]

‘You destroy the thing that you want to own? How is that possible?’

‘Good question. How can one explain a bank’s ongoing fossil fuel investments when the effects have been noticable for decades? By denial, delusion, and a specific set of prioritizations, I would say. Conventional banks are primarily driven by competition and profitability, which means making as much money as possible. At the cost of society and planet, if necessary.

Many of them claim to become more sustainable now: JP Morgan, Citi, Wells Fargo, Barclays, BNP Paribas, HSBC, Goldman Sachs, Bank of China, Deutsche Bank, just to name a few examples. Yet they don’t do enough. Their persisting billions of investment into fossil fuels and exploitative business models tell the truth.[5] But there is one powerful thing we can do against it.’

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Sources:

[1] See Syntellis. “10 Key Financial Metrics & KPIs for Banks & Credit Unions”. Available online from: https://www.syntellis.com/blog/10-key-financial-metrics-kpis-banks-credit-unions, last accessed 09 April 2024.

[2] See Nicholas Shaxson. 2024. “Case study: Monopoly Finance”. In: Taken, not earned. 2024. Available online from: https://www.balancedeconomy.net/wp-content/uploads/2024/01/Case-Study-1-Finance-Final.pdf, last accessed 10 April 2024.

[3] See Sheryar Siddiq. 2023. “5 Largest Banks in the World by Assets.” Insider Monkey. Available online from: https://www.insidermonkey.com/blog/5-largest-banks-in-the-world-by-assets-1160479/, last accessed 09 April 2024.

[4] See Union of Concerned Scientists. 2023. “Memo to JP Morgan Chase Shareholders: Stop Banking on Climate Chaos.” The Equation. Available online from: https://blog.ucsusa.org/kathy-mulvey/memo-to-jpmorgan-chase-shareholders-stop-banking-on-climate-chaos/, last accessed 09 April 2024.

[5] See Banking on Climate Chaos Fossil Fuel Report 2023. 2023. pp. 10ff. Available online from: https://www.bankingonclimatechaos.org/wp-content/uploads/2023/08/BOCC_2023_vF.pdf, last accessed 09 April 2024.