NewB or not to be?

By Rein van Gisteren*

Belgium is waiting for its first ethical and sustainable cooperative bank to start. Will Belgium also get an ethical and sustainable cooperative bank? After more than five years of preparations, the decision is expected from the European Central Bank at the end of 2019.

More than 50,000 Belgians are in the starting blocks to make "socially responsible banking" possible in their country: they are the proud owners of the NewB cooperative.

“They have not forgotten the banking crisis of ten years ago. More than 50,000 citizens are ready for it, along with 154 civil society organizations plus the French insurance group Monseau, who invested 10 million euros; they want to introduce a new standard in the Belgian banking world as a "new bee", a newcomer.

NewB wants to become an internet bank, without an expensive branch network, but with an excellent online service. A bank that manages your wages and savings, but does not invest in the financial economy, but rather in the green economy”, says CEO Tom Olinger. “The interest in ethical banking in Europe is growing.

Citizens are looking for an appealing alternative to cumbersome systemic banks that are guided by a pure profit objective. Money is not the most important thing at NewB, but it is the collective values behind its sound management. For example, our cooperative profiles itself with a striking wage tension: a top banker earns a maximum of five times more than the lowest paid bank employee. And at NewB every cooperative member has one vote, whether you own 20 or 3 million euros in shares”, he explains.

NewB compared itself in its application to the National Bank of Belgium for a banking license with the Banca Polulare Etica (Italy), BAS (Switzerland), Credit Cooperatif (France), Ekobanken (Sweden), GLS (Germany), Merkurbank (Norway) and Triodos (The Netherlands). The most important similarity of these smaller banks is their people-planet-prosperity approach, a terminology we know from the United Nations Sustainable Development Goals.

Compared to the already existing banks from the benchmark, the Belgian NewB with its 50,000 cooperatives can start with a relatively large number of members. Triodos-Bank is active in Belgium, but is no cooperative and does not provide current accounts to private individuals.

And that is precisely the market that NewB wants to capture from the major banks that caused the banking crisis. NewB wants to start with a simple bank account, a savings account and a regular debit card. She only wants to work for the real economy and not to sell derivative (toxic) financial products. Investing in the transition to a sustainable economy is paramount.

Because the establishment of a bank requires so much stamina, NewB is already selling insurances. “The income from this will be of importance once the bank is launched”, Olinger says. 7,000 cooperatives also have a Goodpay payment card. For each payment, NewB donates 5 cents to good cause. The NewB cooperatives held their annual shareholders’ meeting in June.

The bank has to raise additional capital before the ECB approval can be given. If this is completely successful, the new bank is expected to start in 2020.

Because NewB wants to be a sustainable and ethical bank, the bank’s financial products must meet 13 values, set by members in terms of safety, transparency, proximity and participation, innovation and professionalism, and requirements in terms of simplicity, austerity, honesty, integration, diversity, inclusion and sustainability. An independent Social Committee critically monitors the translation of these values into everyday norms and the behaviour of this banking cooperative.

*A communications consultant in Hoeilaart (Belgium)