But banks aren't completely abandoning their typical role as a benefactor of political conventions
Wall Street is keeping a low profile at this year’s Republican National Convention in Cleveland, which officially begins on Monday afternoon. While many bankers and bank executives will undoubtedly be popping in and out for a meeting or two, the actual banks and their logos will be hard to find.
Sources inside the banks are telling Fortune the primary reason for the banks’ silence is, of course, Donald Trump. The presumptive Republican presidential candidate’s harsh rhetoric has soured his image with Wall Street, these people said. After all, banks have customers from around the globe and depend on the free flow of capital, something that Trump has railed against in his attacks on free trade agreements and international commerce.
But Wall Street isn’t completely abandoning its traditional role as a major benefactor of political conventions. It’s just going to be doing so in less noticeable ways than in the past. Indeed, most of the big banks, if not all, will probably be giving some money to the RNC and the Host Committee, directly or indirectly, through various channels. Trouble is, we won’t know how much they will have given until long after the shin-dig is over.
Fireworks popped in the sky over Lake Erie on Sunday night, signaling the unofficial start of the much-anticipated Republican National Convention. The event was put on by the Cleveland 2016 Host Committee, which aimed to highlight the best of what the city has to offer. It started at the city’s futuristic science center, moved on to the Rock and Roll Hall of Fame, and ended at a lakeside park.
The 11,000 delegates and invited guests attending the lavish event, which included comedian and television host Stephen Colbert and the head of the Republican National Committee Reince Priebus, were entertained throughout the night by bands like Three Dog Night and were fed by local-area restaurants and food trucks. Security was tight, with some guests waiting an hour or more to get into the event, but few complained given the terrorism issues of late.
Putting on such a big event isn’t cheap . Luckily, though, the event organizers had some deep pockets to draw from. The opening event, as well as the “Thank You Cleveland” event scheduled for after the convention, was paid mostly by local corporate sponsors, among them, Fifth Third Bank Corp and KeyBank, regional banks both based in Ohio. Other corporate sponsors of events scheduled for this week are mostly big corporations representing a variety of industries from insurance, like AFLAC, to telecommunications, like AT&T.
The big banks are largely steering clear of event sponsorships, with no major events hosted by Bank of America, Citigroup, J.P. Morgan, Wells Fargo, Goldman Sachs, or Morgan Stanley. It would be one thing if the banks had always shied away from funding conventions, but that hasn’t been the case, at least not in the recent past.
People close to the banks have told Fortune that banks are not only sitting the RNC out because of Trump. Part of it has to do with the event’s location. Cleveland isn’t a banking hotspot. That compares with Charlotte, which in 2012 sponsored the Democratic National Convention. Bank of America, which is headquartered in Charlotte, contributed $5 million to the central convention slush fund that year, which gave it the right to splash its logo pretty much everywhere.
Bank of America also gave money for the 2012 Republican convention in Tampa, albeit a much smaller amount than it gave to the DNC, as did most of the other big banks on Wall Street, which tend to lean to the right of the political spectrum. Nearly all of the big banks, at least at one point or another, have given money directly to the local host committee representing the convention or, at a minimum, sponsored some sort of official or unofficial event. This gave bankers the ability to press the flesh with politicians, journalists, and Washington bigwigs in a more intimate, booze-filled, event.
Wall Street’s absence at the 2016 RNC has led to an estimated $6 million shortfall in the convention’s general fund, money that the RNC desperately needs. The only bank doing anything remotely splashy this year is J.P. Morgan, but instead of donating to the convention directly, it decided to donate to area charities. This allowed them to support Cleveland, where the bank has a presence, while not giving money to help Republicans nominate Trump.
But don’t cry for the Republicans just yet. Thanks to strange campaign finance laws, explained here by TIME, the host committee is not obligated to reveal who donated to the central slush fund until 60 days after the event closes. Questions directed to the Cleveland Host Committee regarding the big banks and any contributions made to the convention were rebuffed, as were any questions directed to the banks themselves. So it is possible that Wall Street is laying out some big bucks – they just don’t want anyone to know about it yet. That’s some serious political hedging.