Bank of America gives CEO dollars 50m bonus amid PR strife

SAN FRANCISCO: Just months after stirring up negative publicity for its ban on ATM usage by non-customers and still smarting from the uproar over its now discontinued ’Adopt-an-ATM’ program, Bank of America once again has landed in PR hot water.

SAN FRANCISCO: Just months after stirring up negative publicity for its ban on ATM usage by non-customers and still smarting from the uproar over its now discontinued ’Adopt-an-ATM’ program, Bank of America once again has landed in PR hot water.

SAN FRANCISCO: Just months after stirring up negative publicity for

its ban on ATM usage by non-customers and still smarting from the uproar

over its now discontinued ’Adopt-an-ATM’ program, Bank of America once

again has landed in PR hot water.



The North Carolina-based bank, which was acquired by NationsBank in

1998, made front-page headlines in the San Francisco Chronicle earlier

this month after awarding a dollars 50 million bonus to chairman and CEO

Hugh McColl in 1999 - despite the bank’s disappointing earnings and

plummeting stock price.



The story, which quoted only anonymous sources, noted that McColl’s

bonus was meted out despite stringent cost-cutting by the rest of the

bank’s employees and 19,000 layoffs companywide since the 1998 merger.

Meanwhile, a scant two paragraphs of the two-page article surveyed the

bank’s rationale behind McColl’s bonus. The only comment from B of A

spokesperson Robert Stickler was that the company could not speak about

the award before it was filed with the SEC.



At least one local crisis communications expert said that there isn’t

much the bank can do to alleviate the situation.



’Part of it is that they have a reporter covering them who is

distrustful of large financial institutions and who has very good inside

sources,’ said GCI Kamer Singer chairman Larry Kamer. ’Combine that with

a situation in which the ranks are thinning because of the NationsBank

deal, which could mean they don’t have an adequately staffed PR

department.’



The Institute of Crisis Management’s Larry Smith added that executive

compensation is inevitably a tricky matter. ’It’s not much different

than when Congress votes itself a raise,’ he said. ’There is no easy way

to explain away a bonus like this.’



This is just the latest in a series of major B of A PR snafus over the

past year. In November, after San Francisco residents approved an

ordinance banning banks from charging non-customers extra fees for ATM

transactions, the bank banned non-customer usage altogether - a move

that drew sharp criticism in the local press. And in January, the bank

was bashed for its supposedly voluntary ’Adopt-an-ATM’ policy, which

encouraged employees to clean up B of A cash machines in their free

time. Negative publicity and threats of legal action by the state’s

labor commissioner forced the bank to end that program about six weeks

ago.



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