Take for example this story by Bloomberg's Michael Quint:
MTA Likes Bond Traders So Much to Forgo Subway Cars
May 29 (Bloomberg) -- The first winners in the Metropolitan Transportation Authority’s $750 million bond sale were traders who bought and unloaded the debt immediately for a quick profit, not commuters on the 5:49 p.m. train from New York to Scarsdale.
The April issue was part of President Barack Obama’s Build America Bond program to let local governments borrow at lower cost by having the U.S. Treasury bear 35 percent of their interest expense. The MTA, operator of the nation’s largest transit system, is raising fares an average of 10 percent starting next month to help cover a $1.8 billion budget deficit.
With the federal subsidy, the agency was able to pay a yield high enough for an immediate $3 million profit for traders, according to data compiled by Bloomberg. Lowering the yield 0.1 percentage point on the taxable issue would have saved about $9 million, enough for the agency’s share of eight new subway cars.
Valid or not, the bankers have their reasons for why the believe the pricing was adequate. But rather than explain this to reporters for print, they stew about the stories in private (I've heard them). And their PR guys make their companies look horrible by letting the story hang out there:
Brian Marchiony, a JPMorgan Chase spokesman, declined to comment on the MTA’s pricing or its own bond sale. The agency paid underwriters led by the New York-based bank $6.68 million to handle the sale.
Dellaverson’s statement said Goldman Sachs Group Inc., the agency’s financial adviser, had access to market information that helped it sell with more favorable terms than the earlier transactions that week by California and the New Jersey Turnpike Authority.
Before the MTA transaction, the price of California Build America Bonds underwritten by Goldman Sachs traded at 3.33 percentage points over Treasuries, or less than the 3.5-point spread set at the transit authority’s sale, according to Bloomberg data.
The MTA paid Goldman Sachs $487,500 for advice on getting the highest price and lowest yield, according to Aaron Donovan, spokesman for the agency. Michael DuVally, a spokesman for the New York-based bank, declined to comment.
Maybe I just don't understand communications, but how is this a good PR strategy? I really don't get what investment bank PR people get paid to do, because they rarely give anything other than a no comment and there companies consistently come out looking awful in the media. Can anyone explain to me why you wouldn't at least try to defend the company?