Changing Social Climate: Financial Services
Detailed below are the ways that Bank of America, Citi, and J.P. Morgan have adapted to the changing social climate due to the COVID-19 outbreak.
Bank of America
- Last March 5, when North Carolina announced the first positive case of COVID-19 in the state, Bank of America announced its different measures for the prevention of the spread of coronavirus. Some of these measures include limiting international travel, deep cleanings at its offices, and directing employees who have been potentially exposed to the virus to work from home.
- Bank of America says that it has "closely followed developments related to the coronavirus" and is focused on "delivering for clients while supporting the health and well-being" of their colleagues and all those they serve.
- Also, Bank of America's content messaging now includes an offer of support to their consumers and small business clients through their Client Assistance Program.
- Last March 23, the bank announced that its customers can defer mortgage payments during this financial crisis. Customers are allowed to defer payments for three months. This is one of the measures they implemented for the purpose of easing their customers' financial burden.
- The company has also increased spending as it pledged a $100 million financial support for COVID-19 response efforts. These funds will be "used to increase medical response capacity, address food insecurity, and boost access to learning during school closures in local BofA markets, with a focus on the most vulnerable populations."
- Citi's message on its official site says that their top priority is the well-being of their colleagues, customers, and communities. Citi also offers assistance to those who are impacted by COVID-19. For instance, their retail bank customers and small business customers are offered waived monthly service fees as well as "waived penalties for early CD withdrawals." Eligible credit card customers are also offered collection forbearance programs.
- Last March 6, Citi announced that it has taken several preventive measures for the protection of their colleagues and customers. These measures include ensuring that hand sanitizers are readily available in branches as well as "educating branch teams on best practices recommended by the Centers for Disease Control (CDC)." While on March 15, the bank announced that it has suspended stock repurchases because of the pandemic.
- Citi's spending increased as the company announced on March 19 that "it will provide $15 million to support COVID-19 related relief activities globally." This $15 million will be divided equally to the COVID-19 Solidarity Response Fund, No Kid Hungry Fund ("to support emergency Food Distribution Programs in the US") and to "additional international, country-specific efforts in places that are severely impacted."
- Also, last March 26, Citi temporarily closed 15% of its outlets or around 700 branches to help mitigate the spread of the coronavirus.
- J.P. Morgan has given a wave of support to small businesses that are struggling because of the pandemic. Last March 18, "the company announced a $50 million aid package to help communities recover from the outbreak." From this, "$8 million will go immediately to helping small businesses in the U.S., China, and Europe."
- Also, over $5 million was allocated as immediate support with a big portion that went directly to the World Health Organization for the provision of masks and other protective gear to the front line nurses and doctors. The $50 million aid package reflects the increased spending of the company brought about by the pandemic since this is on top of their regular spending.
- Also, last March 20, JP Morgan announced that it's "giving bank tellers and other front-line employees a one-time bonus of up to $1,000 to help cushion the difficulties of working during the coronavirus pandemic." Aside from that, it also gave all its employees "up to five extra paid leave days and extended the carryover period of unused vacation days from last year."
- JP Morgan's current messaging includes the Coronavirus Aid, Relief and Economic Security Act or the CARES Act. This CARES Act "contains several provisions to provide emergency assistance for Small Businesses affected by the pandemic." It also includes the "payment deferral and loan forgiveness program."
- Last February 27, the company's analyst Gary Taylor said that JP Morgan is extraordinarily skeptical that COVID-19 will prove to be a cause of global financial concern. He even said that "it would likely be a one-time impact that would not impair forward earnings power."
- On March 30, JP Morgan gave suggestions on "how to invest in banking stocks amid the global crisis." The bank said that those who are having difficulty in "selecting banking stocks should look at the ones with a combination of deep funding, high provision coverage, limited issues in asset quality, and strong capital ratios."