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Vernon W. Hill II (born August 18, 1945) is an American businessman, the founder and chairman of Metro Bank, a UK retail bank with 20 branches, and assets of £1.2b ($2.0b). He is also the founder, former Chairman, President and CEO of Commerce Bancorp of Cherry Hill, New Jersey and Chairman of Fetch Inc. (aka Pet Plan North America).

Early career
Although known for banking, Hill’s business outlook has been informed by early encounters with retailing. While taking morning classes at Wharton, Hill worked afternoons at a South Jersey bank owned by a local car retailer, where Hill observed the car dealer applying retail principles to banking operations, such as late opening hours. The job also brought Hill into contact with other local retailers, including McDonald's. After graduation Hill founded a real estate firm to find and develop sites for McDonalds, a task which required Hill to drive McDonald's entrepreneur Ray Kroc on scouting trips. Hill claims his experience with McDonald’s taught him the importance of standardised presentation and scale economies in retailing.

Philadelphia Magazine reports that Hill’s experience with McDonald’s led directly to the creation of Commerce Bank. Referring to the creation of Commerce, Morton Kerr, Chairman of the board of Markeim-Chalmers, Inc., a South Jersey real estate firm, and one of the original Commerce board members, observed:

"“A lot of us knew Vernon from being involved in real estate at that time…He was a 26-year-old kid who called about 15 of us to a meeting in his office. I'll never forget it. He said, 'We're going to start a bank.' And he said we'd each have to put up between $250,000 and $500,000. This was 1973-who had that kind of money? But he'd arranged for all of us to borrow it. If you could put up $100,000, he got us loans for $400,000. Only seven of us didn't get up and walk out, but we still thought he was crazy.”"

The deal resulted in Commerce opening its first branch in Marlton, New Jersey, in 1973.

Commerce Bancorp
Commerce Bank was notable for its rapid expansion, from one branch in 1973 to 470 branches in 2008, and a deposit base that grew by an average of 25% per year between 1996 and 2001 (against an industry average of 5% in 2001). According to Forbes Magazine, Commerce produced a 23% annual shareholder return compounded for 30 years.

Commerce Bank’s economic model rested on the idea that the fixed costs of a bank branch are largely independent of volume, and so profitability lay in maximizing the number of deposits and accounts per branch. Additionally, Hill believed that the industry's reliance on internet banking had led to dis-investment in bank branches, to the detriment of consumers who prioritised in-person service.

"“Other banks decided to push consumers out of the branch because it is the high-cost delivery channel. They wanted to push them online. We totally reject that.  You can’t name me one retailer in this country that has pushed people where they don’t want to go and succeeded…We have some branches that get 100,000 customer visits a month; the average branch gets 40,000.  An average McDonald’s gets 25,000 per month.”"

Hill’s motto for Commerce was “America’s most convenient bank”.

Commerce tactics were oriented to drive volume, differentiation and customer advocacy, including:


 * Longer opening hours, including evenings and weekends; opening ten minutes earlier and later than advertised hours
 * Removing glass from teller booths for a more open customer experience
 * Pet-friendly policies
 * Giveaways such as lollipops and dog biscuits
 * Free use of coin-counting machines
 * Handing out pens in response to rival banks’ practice of chaining pens to desks
 * “Kill the stupid rule” program, whereby employees who suggested an alternative to a stupid rule were paid $50

Commerce Bank staff were awarded $5,000 if a nearby rival bank closed its branches; hundreds of mystery shoppers made tens of thousands of store visits annually, and salary increases were based on mystery shopping scores. Top-performing managers were given sports cars.

On June 29, 2007, Hill resigned as Chairman and CEO of Commerce Bancorp after the Office of the Comptroller of the Currency, the Federal Reserve Bank of Philadelphia and the board of directors of Commerce Bancorp established governance to stop doing business with firms under the control of Hill’s family. Notable business dealings with insiders included property leases with entities in which Hill was a partner, and the purchase of services from an architectural design business run by his wife, Shirley. No charges were brought.

On October 2, 2007, Commerce Bancorp announced that it would be merging with TD Bank Financial Group. The Canadian-based Toronto-Dominion Bank would acquire Commerce for $8.5 billion (U.S. dollars) in cash and stock, at $42 per share of CBH stock, a purchase multiple of x28. Some industry commentators held that Hill's departure and a strong Canadian dollar had made a takeover inevitable. 

PetPlan
Hill is Chairman of Fetch Inc. (aka PetPlan North America), a pet health insurance company founded by Chris and Natasha Ashton. It holds the U.S. franchise from Petplan of Britain, the world's biggest provider of policies for companion animals. Hill invested in the company in April 2008, believing pet health to be a growth market in the USA.

Speaking to Fortune Magazine in 2010, Hill said: "'People used to put down their pets when they got sick. Now they're members of the family. People will want to save them with kidney transplants and hip replacements. This business will be huge.'"

Hill often travels with his Yorkshire Terrier, Duffy.

Metro Bank
Metro Bank UK was launched in London July 2010, with Hill as co-founder and vice-chairman and co-founder Anthony Thomson as Chairman.

Press commentary at the time centred on Metro being the first high-street bank to open in the United Kingdom for more than 100 years, and upon Hill's belief that the competitive landscape of British banking amounted to a commercial opportunity to lead on service rather than price. In 2010, 85% of the UK market for current accounts was held by the “big five” banking institutions (HSBC, Barclay's, Royal Bank of Scotland, Santander and Lloyd's). In 2008 an official report from the Office of Fair Trading concluded that UK banking was subject to weak competitive pressures and profit-maximising strategies. Forbes Magazine described Metro at launch as "...aiming to disrupt a storied industry dominated by a handful of established players".

In an April 2011 speech to the Financial Services Club in London, Hill commented on market research into approval ratings for UK banks, in particular the finding that Lloyds TSB and Barclay's banks had negative net promoter scores overall:

"'If I was Lloyds or Barclays, I would climb under the table seeing these numbers. I've never seen negative net promoter numbers before in my life. I don't even know how you can get negative net promoter numbers. What are you doing?'"

In a BBC News interview, Thomson commented that the cost–driven model of traditional British banks required them to discourage customers from visiting branches, whereas Metro Bank’s model actively sought to attract customers into branches, using tactics such as longer opening hours and pet-friendly policies.

The pair spent a further two years securing a £75m launch investment, including funds from New York real estate developer Richard LeFrak, property investors the Reuben brothers and Fidelity, the fund management company. Metro launched with plans to open 200 branches in London by 2020. Twelve branches were opened by December 2010. In June 2012 the company announced the completion of a £126m round of capital-raising to open further branches in London, including funds from Moore Capital and billionaire investor Steve Cohen.

Noted investor Wilbur Ross commented that "The question is whether [Hill’s] promotional flair and service concept will produce enough customers to offset the extra operational cost of providing the extra space".

Other investments
Hill is a partner with Steve Lewis in US Restaurants Inc, which operates 40 Burger King restaurants in metropolitan Philadelphia.

Hill's first business was Site Development Inc, a real estate development firm which has developed over 1000 shopping centres and retail developments in America.

In 1994, Hill along with partners John Silvestri and Steve Lewis founded and developed Galloway National Golf Club near Atlantic City, New Jersey. The course was designed by Tom Fazio and is ranked by GolfDigest.com as being among the top 100 courses in America.

Business philosophy
Fortune Magazine describes Hill as a “...flamboyant, tradition-stomping American billionaire…the P.T. Barnum of banking”.

Hill has often advocated a business development strategy based on organic growth rather than acquisition, and by generating customer loyalty through service rather than price. Speaking to a 2010 House of Commons Treasury Select Committee on competition and choice in the banking sector, Hill said:

"“My opinion is that great retailers never grow by acquisition…If you see yourself as a retailer delivering an unusual service, acquisitions are the easiest way to kill your model…[Organic growth] is slower, but you get what you want at the end. You get a group of people running your model, not somebody else’s model….”"

Hill is a critic of the shadow banking system, believing it to largely responsible for the 2007-2012 global financial crisis.

"“We have two American banking systems. We have the normal banking system, with 8,000 banks serving consumers and businesses throughout America. Then we developed a shadow banking system…the money market funds, the investment banks, the credit default swaps. The current crisis is really a crisis of this shadow banking system….I think when [banks] are making a loan to, say, a restaurant, the overwhelming majority of banks aren’t playing games. As long as the guy’s paying, it’s a loan that pays back over time. Then we moved into all this exotic stuff — credit default swaps, CDOs. Believe me, no one at Goldman Sachs understands what they have on their books, because these kids are sitting at their computers dreaming this stuff up….”"

Hill is often quoted as viewing his banks to be in the retail business rather than the banking business.

"“You don't have to think about what time a Home Depot, a McDonald's or a Starbucks is open,” Hill says. “They're open. You just go. My theory was, if you advertise that [your bank is] open on Sunday, the consumer will automatically believe you're open all the time. That message is more important than the savings.'"

In its 2007 20-20-20 Club, Forbes Magazine lists Hill as one of seven CEOs (along with Warren Buffett and Larry Ellison) of publicly traded companies with tenures of over 20 years to deliver an annual shareholder return in excess of 20%. Commerce produced a 23% annual compounded shareholder return over that time.

Personal life
Hill is the son of a Virginia real estate brokerage owner and the eldest of six children. He graduated from Wharton School of the University of Pennsylvania in Philadelphia in 1967, earning a BS in economics with a concentration in finance.

Hill's 46,000 ft² (4,270 m²) home, Villa Collina, is located in Moorestown Township, New Jersey. He resides there with his wife Shirley Hill, the founder and CEO of Interarch, an architectural services firm.

In 2005, the Hills donated $10 million for a new building at the School of Veterinary Medicine at the University of Pennsylvania, Vernon's alma mater. The building is called the Vernon and Shirley Hill Pavilion.