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However, the study was designed to compare coverage from before the historic single-day market drop and after that event. So, a constructed week was drawn for each period. That means seven days of coverage for each of seven newspapers for each of the two portions of the study period, or a total of 14 days of coverage were analyzed. The news articles were coded and categorized as “Before” (prior to September 30, 2008) and “After” (September 30, 2008, and thereafter).
A total of 188 articles were downloaded using this stratified sampling method. The constructed week’s worth of coverage from each newspaper yielded 85 articles from the “Before” period and 103 articles from the “After” period. An online random number generator was used to determine the dates of coverage to be included in the study. The dates randomly
identified were as follows:
• “After” Period: Monday (November 24), Tuesday (November 11), Wednesday (October 15), Thursday (December 18), Friday (October 10), Saturday (December 20), and Sunday (December 9) Content Categories News releases were coded for two image restoration strategies: (1) acknowledging the financial crisis and (2) expressing concern for consumers. Acknowledging the crisis means banks made reference to uncertainty and/or declines in the American financial market. Expressing concern for consumers means the bank acknowledged that consumers’ well-being may be affected by the financial crisis. Both of these strategies were coded as being either present or absent within the news release.
665 For the purposes of this study, a mention in news coverage was defined as the first mention of a bank within the text of article, as well as the two subsequent paragraphs following that mention.
In assessing the tone of news coverage, each bank’s mention in an article was coded as being positive, neutral, negative, or a mix of positive and negative. A bank’s mention was considered positive if it alluded to growth in revenue, market share, and/or size and scope of operations. Within the realm of positive news, indicators specific to the banking industry were used as identifiers, including strong earnings, healthy liquidity (the ability to convert reserves and investments to cash), sufficient capital for reinvestment in its own business, increasing assets, decreasing liabilities, or general expressions of growth either through the sharing of tangible results or the announcement of new products, services, strategies, facilities or markets, or the promotion and/or recruitment of new leaders within the organization (e.g. “Our earnings exceeded expectations this quarter.”). 16 Negative coverage consisted of a negative slant to any of the factors mentioned above (e.g. “Our earnings fell short of expectations this quarter.”) Neutral was the absence of a positive or negative tone (e.g. “Our earnings met expectations this quarter”), while mixed coverage included those mentions that contained both positive and negative statements (e.g. “Our earnings were down this quarter, but we see a bright year ahead.”) To assess the applicability of the SCCT to an industry-wide crisis, mentions of banks in news articles were classified into one of the three organization-specific crisis clusters from the SCCT model (i.e. victim, accidental, or preventable). The victim cluster is one in which news coverage positioned the bank as a victim of the financial crisis -- that is, the bank did not take any actions whatsoever that contributed to the industry-wide crisis. For the accidental cluster, news coverage positioned the bank as having taken some actions that unknowingly, inadvertently and/or indirectly contributed to the industry-wide crisis. Finally, the preventable cluster includes news coverage that positioned the bank as having allegedly put people at risk, taken inappropriate actions, violated laws or regulations or done something else intentionally that contributed directly to the development of the industry-wide crisis.
The study was designed to compare news releases and news coverage from before the historic single-day Dow Jones Industrial Average market drop on September 29, 2008, with news releases and news coverage after that event. The coding categories for timeframe were “Before” (July 1, 2008 through September 29, 2008) and “After” (September 30, 2008 through December 31, 2008).
Intercoder Reliability Two coders, working independently, implemented this study. Ten percent of the news releases and a randomly selected sample of 10 percent of news articles were used for reliability testing. Intercoder reliability results (Scott’s pi) ranged from.86 to.92 (see Table 1).
16 Adapted from the Uniform Bank Performance Report, an analytical tool used by the Federal Financial Institutions Examination Council in examining banks. The FFIEC is a formal, interagency body empowered to prescribe uniform principles, standards, and report forms for the federal examination of financial institutions by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision, and to make recommendations to promote uniformity in the supervision of financial institutions. For more information, visit http://www.ffiec.gove/about.htm 666
Results of the content analysis are as follows:
RQ1: How do the image restoration strategies used by banks during a financial crisis relate to the tone of newspaper coverage these banks receive – positive (confidencebuilding), neutral (neither confidence-building nor confidence-eroding), mixed (confidencebuilding and confidence-eroding) or negative (confidence-eroding)? There was not a readily apparent pattern of correspondence between how a bank positioned its news release content and the overall ratio of positive news coverage received during the six-month period studied (see Table 2). Washington Mutual, which had the highest percentage of news releases acknowledging the financial crisis, finished in the middle of the pack in terms of ratio of positive news coverage.
Wachovia had the highest percentage of news releases expressing concern for consumers, among banks receiving news coverage during the study period, yet had the lowest ratio of positive news coverage.
The findings for Hypothesis 2, shared later in this paper, examine correlations between these variables. However, it should first be noted that the five largest banks accounted for more than 86 percent of all news coverage during the time period (see Table 3). In fact, four of the smallest banks in the top ten each received less than four percent of the total news coverage during the study period. For that reason, the remaining analysis in this paper focuses only on the top five banks, namely Citigroup, Bank of America, JP Morgan Chase, Wachovia and Wells Fargo.
To help understand the efficiency of the banks’ media relations efforts, a side-by-side comparison of news release volume and efficiency ratios was calculated (see Table 4). Citigroup received the most amount of coverage for its media relations efforts during the study period; JP Morgan Chase, conversely, had the least efficient media relations among the five banks most successful in terms of media relations efforts.
RQ2: How do newspapers generally treat the role of banks in a systemic financial crisis – as victimized by the crisis, as accidentally involved in the crisis, or as perpetuators of preventable actions that might have averted the crisis? Most often, the five largest banks in the nation were positioned as having taken preventable actions that contributed to the financial crisis; Bank of America was most often portrayed in this negative light, while Wells Fargo was the bank least likely to be portrayed this way (see Table 5). Conversely, Bank of America and JP Morgan Chase were most often portrayed as victims of the industry-wide financial crisis; Wells Fargo, once again, was least likely to be portrayed in this light. It seems that Wells Fargo, on average, received the least coverage portraying it as a catalyst for, or victim of, the financial crisis. This may have had some relationship with Wells Fargo’s successful bid to purchase Wachovia, another of the five largest banks, during this time period. It may be that the media perceived Wells Fargo as being relatively unfazed by the crisis. Further research would be necessary to answer that question. Finally, none of the five largest banks received any news coverage portraying them as being accidentally involved in the financial crisis. That fact challenges the viability of applying the SCCT model to an industry-wide crisis.
667 Hypothesis 1: Banks that actively acknowledged the financial crisis in their media relations efforts – regardless of the image restoration strategy employed – earned a higher percentage of confidence-building news coverage than banks that did not acknowledge the crisis at all. This hypothesis was not supported. In fact, the bank that most often acknowledged the financial crisis in its news releases – Wachovia – had the lowest ratio of positive coverage (see Table 6). Conversely, Bank of America least often acknowledged the financial crisis yet had the greatest ratio of positive coverage. It could be inferred that focus on more positive matters than crisis-related problems might be the most successful media relations strategy in the midst of an industry-wide crisis, or at least one of a financial nature. Further research would be necessary to validate this new hypothesis.
Hypothesis 2: Banks that expressed concern for consumers regarding the financial crisis earned a higher percentage of confidence-building news coverage than banks that did not express concern for consumers. This hypothesis was not supported. As with Hypothesis 1, Wachovia most often expressed concern for consumers yet received the lowest ratio of positive news coverage, while Bank of America least often expressed concern yet received the highest ratio of positive coverage (see Table 7). Again, it could be inferred that steering clear of industry-wide headaches and related consumer concerns might yield the most effective media relations results. Further research would be necessary to test this approach.
To provide more detailed analysis, correlation coefficients were calculated for the variables at play in the two hypotheses of this study. The only correlation that emerged as significant was the one between banks being portrayed as victims by the media and news coverage being positive in tone, rs =.900, p.05 (see Table 8).
One final data analysis reveals an interesting trend. During the study period, the reputations of JP Morgan Chase and Wells Fargo worsened significantly, in terms of tone of coverage as well as media portrayal of them as either victim of or catalyst for the financial crisis (see Table 9). Citigroup and Bank of America, on the other hand, generally improved or maintained their reputations. JP Morgan Chase and Wells Fargo bought Washington Mutual and Wachovia, respectively, during the study period, while neither Citigroup nor Bank of America had such significant acquisitions, although Citigroup did lose its takeover bid for Wachovia to Bank of America. It might be inferred that staying the course is the key to riding out the storm of an industry-wide crisis. Again, further research would be necessary to explore this hypothesis adequately.
Discussion This study was designed to help answer how the image restoration strategies used by banks during a financial crisis relate to the tone of newspaper coverage and how newspapers, generally, treat the role of banks in a systemic financial crisis. Findings indicate that news media are most likely to portray banks as having taken preventable actions that contributed to an industry-wide crisis rather than as victims of the crisis. In addition, not acknowledging the crisis and/or not expressing crisis-related concern for consumers may result in a greater ratio of positive news coverage for banks involved in an industry-wide crisis, which is contrary to the originally proposed hypotheses.
668 Findings indicate that neither IRT nor SCCT adequately address an industry-wide crisis.
Results of this content analysis indicate that the models may only hold true for organizationspecific crises, which is how they have been defined and defended to date by other scholars.
Many factors are at play during a financial crisis, and it is all but impossible to control for so many variables in a study of this sort. However, with further research and analysis building upon these initial findings, it may be possible to validate that IRT and SCCT are not acceptable models for crises that stretch beyond a single organization and affect entire industries.
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