On June 9, the US Treasury Department announced that 10 financial institutions would be allowed to repay billions of dollars they had received through the Troubled Asset Relief Program (TARP). BB&T, a financial services organization founded in 1872 that offers a set of services including banking and lending, was one of those companies. It had received about $3.1 billion.
Toward the end of BB&T's association with TARP, its CEO Kelly King began to openly discuss his feelings about it. Kelly, who took over the company's top position in January, said, “TARP was politicizing the lending process.” He added that the program was “destructive.” He's been quoted in The Wall Street Journal and Reuters, He also appeared with other financial service leaders on the May 18 edition of CNBC's Squawk Box.
“In 2008, we outperformed 99% of the financial industry, yet we were still part of this TARP black eye,” says Bob Denham, SVP and director of corporate and executive communications at BB&T.
Historically, the financial services industry has been tight-lipped in its PR approach. Yet traditional financial institutions, startups, and boutiques are now pushing out their messages to the media and other stakeholders in more assertive ways to strengthen and rebuild reputation.
Denham says the company has tried to separate itself, emphasizing its responsible lending practices, its willingness to help bring liquidity to the markets once it received TARP funding, and the fact that commercial banks, for the most part, were not to blame for the economic mess in the first place.
“I've seen more and more of the commercial banks separating themselves with the kind of messages that are close to ours,” he adds.
According to Sean Kevelighan, VP at Zurich Financial Services' media relations group in North America, the company has boosted its communications efforts. Part of that has included creating Kevelighan's post (he joined in 2008) and one like it in the UK.
“Zurich was ready to get out more about itself and the lessons it's learned over the last couple of years,” he explains.
Zurich CEO Jim Schiro has traveled to the company's global offices speaking to employees about the organization's health with video posted on YouTube. Schiro discussed this effort with The New York Times for an article in May. He's also met with other members of the media to speak about the insurance industry and the state of the business.
In addition, the company is establishing Twitter handles that will work in concert with its HelpPoint Advocate initiative, which provides the media and consumers with information on how to prepare for catastrophes and life-altering events.
“Financial services has probably one of the largest lessons learned about communications,” says Kevelighan. “They must be on message and proactive or there's a high risk in the news cycle.”
“Wall Street 2.0”
During the first quarter of 2009, Jennifer Prosek, partner at CJP Communications, started receiving more calls from financial startups and boutiques. She dubbed the companies “Wall Street 2.0,” and says the organizations are using more proactive communications to carve out a niche in the financial services space.
“Wall Street 2.0 companies see market share opportunity and want to raise visibility quickly,” says Prosek, whose agency has added five clients in this space.
“They are unencumbered by issues that large, publicly traded institutions can have,” she adds. “They don't have to repair their reputations.”
In discussing her company's PR goals, Donna Wells, CMO of Mint.com, a free online personal finance service that launched in September 2007, pinpoints building awareness of the company in a category that is new to most consumers and establishing trust. To that end, it has worked with its firm, Atomic PR, on making its CEO, Aaron Patzer, along with the company's products and services accessible to the media.
Wells says the company's willingness to be proactive and transparent is helping Mint.com achieve its goals.
She adds: “I think the reason we have been successful is we've truly been accessible.”
What other financial services entities are doing
The second phase of the company's global campaign, Different Values, will focus heavily on New York, and feature some experiential events
After getting approval to become a bank holding company, GMAC began an aggressive media push to rebrand its online savings bank, Ally Bank, with a message of transparency
The financial service organization that serves military members is on Twitter, YouTube, and Facebook, and it just introduced an iPhone app