Terry Murden: Airdrie Savings Bank's alternative vision

THE emergence of new banks, encouraged by those dismayed by the failure of the old ones, will be slow and patchy. Needless to say, some of them will be not-so-new banks; more likely they'll already be established overseas, carry a familiar brand in related activities or, in the case of the Airdrie Savings Bank, they'll remind us that they have been here all along, getting on with their business largely unnoticed.

Friday's announcement that a group of Scottish business leaders, including Brian Souter, Sir Angus Grossart, Sir Tom Farmer and Sir David Murray, are investing 10 million into the Airdrie grabbed attention throughout Britain, not merely because of the notoriety of the bank's new wealthy well-wishers but because of what their collective action symbolised.

The Airdrie is the last independent savings bank in the country, a small institution with a mere seven branches and 60,000 customers. In an era of globalisation and the instantaneous swirl of money and complex financial instruments, the Airdrie offers a model of virtue and old-style banking.

Its total assets of 150m are a fraction of the bonuses paid out by the big banks to so-called star traders who plunged the country into debt and recession. Indeed, the Airdrie's trustees work for nothing and its president told me he doesn't even claim his petrol expenses for all the functions he attends on the bank's behalf.

In short, the Airdrie is an antidote to the culture of Big Banking. And Stagecoach boss Souter is right when he says the country will respond positively to the investment in the Airdrie because the public is still angry at what happened to the big banks. Scots are particularly angry because it impacted on Scottish pride, in a country that had earned a reputation for prudent money management and is still coming to terms with seeing its two biggest financial institutions come close to ruin.

But what will the investment in Airdie Savings Bank achieve, other than helping in a small way to restore that lost pride? Ten million pounds put on deposit will clearly mean more to this bank than to any of its rivals, who would see it as loose change. It will use the money to lend more and to help in its own expansion plans. It wants to roll-out its internet operations and Souter has spoken of building its capital base to allow it to support more businesses.

However, its first proposed forays outwith North Lanarkshire since it was established in the back of a hat shop in 1835 are limited to opening just two more branches. With a history of one branch opening every 25 years, we should not get carried away with the idea that the Airdrie is about to set the banking world alight.

Of course, it does not intend to challenge the big banks for market share, only to offer an alternative to those who feel it provides comfort in an unpredictable world, and that supporting it means investing in all the things we all say that we want from our banks: probity, security and personal service.

Airdrie Savings Bank is now added to the list of new, or perhaps more appropriately styled, alternative banks.

The most likely challenger to the big four is the Spanish giant Santander, already the owner of Abbey National and Alliance & Leicester and now acquiring 318 branches from Royal Bank of Scotland.

Below that there is only activity at the margins.

Lord Levene's NBNK Investments vehicle has just raised 50m on the London Stock Exchange and wants to buy assets, possibly the branches of Lloyds TSB Scotland, while the US Metro Bank has just announced its second branch in London. The others include Kent Reliance and Virgin Money, though neither has made much progress.

The City remains largely unmoved, judging them all - with the exception of Santander - as minor players.

But the voices for change have been heard and while it may be coming from the back of the room, the Airdrie is in there shouting.

tmurden@scotlandonsundaycom