The bank is thought to have requested credentials and scheduled meetings with a handful of PR agencies. The meetings – led by communications director Brian Giles – were to have taken place in October. It is not known whether the process has since been aborted.
Northern Rock currently uses City agency Finsbury for financial and corporate PR. The agency is believed to have dedicated extra staff to the crisis. Northern Rock and Finsbury both failed to respond to PRWeek’s calls.
Northern Rock and the Financial Services Authority (FSA) have both come under fire for their response to this week’s crisis, which saw the Northern Rock’s shares plummet and the Bank of England award the bank emergency funds.
As panicked customers began emptying their accounts, the bank and the FSA were pilloried in the press for not communicating properly that savings were not in any danger.
‘The real breakdown in communications on this occasion came from the Government and the Bank of England,’ said financial services agency Teamspirit planning director David McCann.
‘Last week, Bank of England governor Mervyn King publicly stated that he would not intervene, yet Chancellor Alistair Darling contradicted this claim with his decision to guarantee that all monies in Northern Rock would be covered.’
A spokesman for the FSA said that it had ensured it put out ‘consistent messages’ through its website and through the press.
As the crisis developed, other banks were drawn in, including Alliance & Leicester, which saw its shares tumble on Monday. Retained agency Lansons said the bank was pursuing a similar policy of issuing ‘basic and sober’ messages.
On Tuesday, Alliance & Leicester hosted a party at the National Gallery, arranged months before the current crisis. During the event, which proceeded as planned, senior bank staff explained the situation in informal briefings to journalists and stakeholders.
‘Northern Rock’s comms style was too complacent’
Hamish Thompson (l) was formerly Dixons Stores Group head of media relations and is now a director of agency Twelve Thirty Eight:
The approach that Northern Rock uses in its communications has always been self-assured, perhaps a little over-confident, for a financial institution. The relaxed manner that served it well on the way up is the exact opposite of what was needed in the face of the onslaught of the past week. Utter the words ‘bank’ and ‘crisis’ in the same sentence and it will expose our most conservative tendencies. What investors like is confident, earnest reassurance. Less of the entrepreneur, more of the judicious clerk, in other words.
For City commentators, the somewhat casual style will have encouraged perceptions that it is ill-equipped for a crisis.
Applegarth has also at times seemed uncertain of what style to adopt, flitting between the jargon-enriched (‘It’s an astonishing thing to see the sterling three-month interbank market effectively not exist’) and the less-than-reassuring (‘I’d love to be a part of rebuilding it, if asked to’). What nervous customers want is a consistent message.
Another misjudgement has been the regular repetition of the levied criticisms in responses to questions. If you repeat the complaint, it’ll appear in your quote.
There have been a few scheduling gaffes. The CEO would have been better advised to honour all interview commitments, as a fuming Gavin Esler on Newsnight made clear.
Finally, Northern Rock’s position that it is a hapless victim has not washed with analysts or City pages who have been quick and thorough in their explanation of the flaws in the bank’s business model.