PhillyDeals: Vernon Hill is a hit in London as new bank opens

Vernon W. Hill II might have worn out his welcome with U.S. banking regulators, who forced his 2007 retirement as boss of profitable, fast-growing Commerce Bancorp Inc., and dragged out approval of his plans to build a successor U.S. bank for so long that it had to be scrapped.

But this week, Hill is making a splash in London. His new Metro Bank is scheduled to open its first branch Thursday near the Holborn Metro stop, offering Commerce-style seven-day service, free dog biscuits, and rapid teller service that's been rare in Britain.

"It's going to be great," Hill's wife and chief bank decorator, Shirley Hill, told me as the couple's Yorkshire terrier, Duffy, yapped in the background. She was scheduled to receive U.S. investor Richard LeFrak, celebrity stock analyst Meredith Whitney, "a couple of duchesses, people from the House of

Lords, members of Parliament, and someone who is bringing a rock star as their date" as the bank celebrated the opening of the first of a planned 200 branches.

The Hills, who own a 40,000-square-foot Moorestown palazzo that Shirley designed, have taken a penthouse apartment on Park Lane in London's tony Mayfair district as their English base.

Why does London need a made-in-Jersey bank? "British banks are not delivering service to customers, because they are financially stressed, and they don't have a culture of service," said Metro board member Gene Lockhart, who ran Britain's former Midland Bank before serving as chief executive officer of MasterCard.

"The oligopoly of British banks does not [impose] banking charges on customers. The quid pro quo is, they don't provide customer service, either," says Howard Flight, one of Britain's biggest private investors and "nonexecutive senior director" of Metro's board.

"U.K. banks have legacy issues. Legacy computer systems, legacy [branch] premises, and legacy working practices," said Craig Donaldson, whose former employer, Royal Bank of Scotland, sent him to Harvard to study Hill's bank - then Hill seduced him to run Metro's retail operation. Now, "we're setting up a greenfields site where we can build the right systems and the right premises, and recruit people for the right culture," Donaldson said.

British banks lost prestige amid the 2008 government takeover of most of the industry's large players in the credit collapse, leaving customers disgusted and hunting alternatives, Flight says.