Anthony Hilton: Investment banks left out in the cold

The most difficult job in financial PR must be to devise and execute a strategy that will rehabilitate the banks. Normally, people have a limited capacity for anger.

Anthony Hilton
Anthony Hilton

They experience it; it is cathartic; it passes and they are prepared to move on. With the banking crisis this has not happened.

The public was outraged at the way the greed and ethical shortcomings of the banks contributed to the financial crisis and resented it even when it accepted the need for the subsequent bailout. The banks still arouse fury because they are carrying on as if nothing has happened and are continuing to reward themselves beyond any justifiable level.

Second, while politicians, regulators and central bankers are united in their call for wholesale reform of the financial system in order to reduce the chances of another crisis with similar origins, the banks have refused to co-operate. Their strategy is to play it long and to hope that, as the global economy recovers, the drive for reform will run out of steam.

However, the real excess is within investment banks - which are not bankers in the commonly accepted sense of the term, in that they do not take retail deposits or make loans. The behaviour of the high street banks has been much more restrained. Evolving PR strategies are beginning to reflect this difference. Most investment banks have simply given up on mainstream PR, except for Goldman Sachs, interestingly, which is engaging far more now than it ever has in the past, perhaps because it realises is has so much more to lose from a change in the political weather.

The high street banks, in contrast, have embarked on a series of one-on-one background briefings between chief executives and selected hacks to begin to rebuild bridges. It is all off the record, but they are delivering a message of hope. We are not out of trouble yet, but we are heading in the right direction and it is time to move on.

Such a strategy takes time, but it does mark the beginnings of a thaw. Attitudes to high street banks will probably mellow considerably in the next few months. Investment banks, however, will continue to suffer.

- Anthony Hilton is City commentator on London's Evening Standard.

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