Interpublic's Bozell, New York, retained the key consumer banking and affluent-markets accounts. Interpublic's interactive agency R/GA and direct marketing shop DraftWorldwide will also work on the business, according to executives close to the search. Bank officials would not comment on the review.
The win is a major victory for Interpublic and for Bozell, an agency whose fate has been clouded by a string of account losses. Interpublic has been hit hard by earnings and accounting woes. Its stock declined 8.7% to $12.40 on Oct. 25 after Moody's Investors Service downgraded some Interpublic debt to "junk" status.
Bank of America spent $167 million on U.S. media last year, according to Taylor Nelson Sofres' CMR. The bank was one of the few financial advertisers to increase spending in 2001 and it has kept spending steady this year.
Advancing a trend of hiring holding companies rather than agencies, Bank of America had pitted Omnicom against Interpublic, asking each to package its resources (AA, Sept. 9). Cathy Bessant, who became corporate marketing executive last November, has said she wants the bank to communicate consistent marketing messages across its various units.
Bank of America recently hired Omnicom's Arnell Group to develop an "identity architecture" across divisions. The bank shuffled its roster this year, hiring two other Omnicom shops for creative assignments while moving its media account from Omnicom's PHD. Those assignments are not expected to be affected by the just-completed review.
Last December, the bank hired Doremus Advertising to handle a business-to-business assignment worth $10 million to $15 million. In July, it tapped Arnell for the branding job and BBDO Worldwide to handle the launch of a new investment service. Its media review wrapped up last month after Publicis Groupe's Starcom MediaVest underbid rivals in an online auction (AA, Aug. 19).
The new assignment is also not expected to affect the bank's multicultural shops, WPP Group's Kang & Lee and UniWorld or independent Lopez Negrete Communications.
Moody's last week lowered Interpublic's senior unsecured debt to its lowest investment grade and subordinated debt to a junk rating. In a skeptical report, Moody's cited weak performance and pressure from the acquisition of True North Communications, and noted that Interpublic's debt securities load, now at $3 billion, has essentially doubled since 1999. Moody's followed Standard & Poor's in downgrading Interpublic. The moves could make it more costly for Interpublic to borrow money.
Interpublic said it has "excellent relationships"with lenders and "numerous options" regarding how it manages its balance sheet.
contributing: lisa sanders