Bank of America to charge $5 debit fee

[catleg]

It seems the big banks are addicted to fee revenue. I read somewhere that the large banks are getting more revenue from fees than from interest earnings.

Yeah that is the twin edged sword of Zero Interest Rate Policy. For a while it helped the banks but now Bernanke is trying to flatten out the yield curve which is bad news for banks. Fee income is down and so is investment banking and trading (aka fleecing customers).

What's a poor bankster to do?

[iv65536]

It seems the big banks are addicted to fee revenue. I read somewhere that the large banks are getting more revenue from fees than from interest earnings.

[AngelinaCat]

*Heh* I once went into a bank with a 100 dollar bill to get broken into smaller bills. No can do, unless you have an account there. They would be *glad* to open an account for me, but then I would wait several days before I could get my change.

I went to the CVS next door and bought a few dollars of nothing, and they had no problem issuing me change for my large bill. That was in January 2008.

[mountanddo]

I used to get free checking at TCF but I closed my saving account and stopped the automatic transfer from my checking into my savings and now it is going to cost me $9.99 a month which is a lot of money to be granted access to my money. How do you open an account at a credit union and can I do that once I file for C-13?

On a side note, I went in to get quarters for laundry and she asked if I had an account. Apparently if you don't they charge .10 per roll. They are raking in the bucks there!

[AngelinaCat]

http://www.csmonitor.com/tags/topic/...ca+Corporation

Damn it! Don't they know I went through a BK, am working on my credit, and need to save every penny I have? I haven't used my debit card in months, I have moved over to just relying on my credit card, but I can see a point where I may need to use my debit card for something. What BofA is doing is like they are putting on a $60 annual fee for my debit card. And I get no rewards? Absurd!!

Now I really have to find a new bank.

There was a thread already on that subject so your thread was merged with that one into the 'BK & Credit News' forum.

Thank you

[IBroke]

Regions Bank just "introduced" this fee as well - although it's "only" $48/year. My CU pointed out that they WON'T charge any fees for the debit card use.

[iv65536]

Even though neither Wells Fargo nor US Bank (the two big banks in the Minneapolis area) haven't imposed such a fee here (yet) I am in the process of transitioning from accounts at both banks to a credit union. No monthly fee for the checking account, and the bill pay fee is waived by simply using it to pay three bills a month. Look around; I am sure you will find what you need.

[catleg]

I had to laugh when 1.9 billion of JPM Chase's earnings this quarter came from the reduction in value of their own issued bonds.
As if they could just buy them back at a discount and book the profit. (but of course they are in trouble, that's why the bonds are down/CDS are up).
I would love to see the "corporations are people" folks issue them a 1099-C and try to collect taxes on that accounting trick! :-)

[banca rotta]

Actually the Durbin amendment to Dodd Frank called for the Federal Reserve to do a study on debit card interchange costs; it is the (bank owned) Federal Reserve that determined the new allowable "vig" that banks could charge for debit transactions.

Then the banks as a political move decided to try and recast this as an argument about overregulation.

I'm glad you can see that the banks own the fed, so when the fed regulates the banks they are acting in the bank's best interest.

Just today Bloomberg announced that BOA took $75,000,000,000,000 (That's 75 trillion!) of BOA/Merrill Lynch mobs derivatives and transferred them from M Lynch to the bank holding company division.

These derivatives in case anyone is wondering are insurance contracts that BOA sold to investors and will have to pay out in the event of a default.

Example: If an investor bought a derivative called a credit default swap for say a billion dollars, betting that Greece defaults on it's debt (and it looks like they will soon) then BOA has to pay the counter party that bought the CDS.

This is Wall Street's version of insuring risk while collecting premiums. The fact that they moved this huge liability to the bank hold company from the investment company means that tax payers will most likely be on the hook for these bets if Greece or another nation or bank defaults.

This is basically AIG a few years back only several trillion larger.

[catleg]

Anyone could have seen this coming. Fedgov placed limits on what banks could charge for per transaction fees, so they upped their fees in other places. This is what happens when the government tries to mandate what the price should be for a service instead of letting the market decide.

Actually the Durbin amendment to Dodd Frank called for the Federal Reserve to do a study on debit card interchange costs; it is the (bank owned) Federal Reserve that determined the new allowable "vig" that banks could charge for debit transactions.

Then the banks as a political move decided to try and recast this as an argument about overregulation.

[Slingerland]

Actually this is tacky on my part, but why not give everybody a chuckle...

Regions also has several of my rental property mortgages. Last week I was trying to set up online payment using the new Arvest accounts. I needed to manually make the payments for one month while setting up direct debit. I was trying to set up the payment for the 5th of the month (within my grace period) but the online system kept flagging it with a fee.

Here's the way the conversation went:

REGIONS: Hello, my name is (redacted). How may I help you?
ME: I am wondering why I'm being charged a fee to make an online payment.
REGIONS: Are you making the payment before the due date?
ME: I'm making it within the grace period.
REGIONS: But it will be late?
ME: No. Late is on the 15th of the month.
REGIONS: Why are you paying late?
ME: I'm not paying late. This is a mortgage with grace period. It's due on the 1st with a 15 day grace period.
REGIONS: Why do you not pay on time?
ME: I need time for the tenant's check to clear.
REGIONS: Oh, okay. There is no fee if you use a Regions account.
ME: I'm closing my Regions checking and savings accounts.
(silence)
REGIONS: (typing) I see that. You previously had auto-debit. Why are you no longer using auto-debit?
ME: As I mentioned, I'm closing my Regions checking and savings accounts.
REGIONS: (timdly) Why are you closing your accounts?
ME: Because Regions keep adding fees to my accounts.
REGIONS: What kind of fees?
ME: Well, for one thing, fees for paying my mortgages within the grace period.
REGIONS: (oh)
(silence)
REGIONS: This isn't going to get any better is it?
ME: No.
(silence)
REGIONS: When you have your new checking account, will you be setting up auto-debit?
ME: Is there a fee?
REGIONS: (mumbling) God I hope not. (to me) No sir, no fee.
ME: Yes, I'll set it up once these payments are made.
REGIONS: There's no fee if you pay during the grace period at the branch in person.
ME: Thank you!

[Slingerland]

I was a Regions customer for 23 years... personal checking, joint checking with my wife, company checking/savings for my rental properties. My kids opened their first accounts at Regions. Notice I said "was"... the $4 debit card fee when assessed against 4 accounts would be $192 a year just for the 'privilege" of them storing my money. To add insult to injury, I was told my rentals were not "large enough" and I would be charged $15 a month just to have a commercial checking account with them.

Fortunately there are two local banks in my city who are heavily advertising their "no fee, never a fee" free checking (Bank of the Ozarks and Arvest Bank.) I happily moved all my accounts to them.

[DYLAN150]

Treehugger from Ore-E-gun: I have a credit union account and everything is free. No checking charges, they give me free checks. So there not making any money from me but then again, it's free because I am an old fart. But then you have people like my 35 year old son who use's his debit card at 7/11 for a $1.25 purchase. I know what the banks are after, they want a person to use their credit card.

[treehugger1]

Wow, I had no idea this news release would generate so much interest. I'll add my personal experience over the past 5 decades. In the Pacific Northwest in the late 60's - early 80's there was no such thing as free checking. I exclusively banked at credit unions becaue they had the lowest costs. However, these costs generally included a $5.00 per month membership charge, a fixed cost for checks up to a certain amount of checks written, or a fixed cost for unlimited check writing ability. Do others remember these types of accounts? In addition, no bank paid you interest on your checking account.

It is not my intention to take sides with the corporate banking industry. However, we seem to have come full circle.

I have been stunned to learn of the costs often passed down to the consumer because stores have to pay a cost for consumers using a debit or credit card. What a strange, strange world.

While I am not defending the big banks, I do defend their rights to offer "contracts" to consumers. If you do not understand your contract, then do as I do; operate on cash, money orders, cheap pre-paid debit cards, etc.

[shark66]

The ones hooked on Starbucks are not likely to be the same ones who will be closing their bank accounts...

Can't wait for this to start happening...I'm with a small local bank, but will have *no* problem going all cash if they attempt to implement any nonsense like the one discussed in this thread...

Good luck to us all.