Bank of America planning more checking account fees
When Bank of America announced a $5 monthly fee for debit card users, it became a villain. The bank is at it again, as a new slate of checking account fees is on the way for Bank of America account holders.
Apparently they never learn
In late 2011, a furor erupted over bank fees. A small exodus from large banks to smaller community banks and credit unions began. The National Credit Union Administration recorded 1.3 million new customers last year, almost 400,000 of which joined in the last quarter of 2011, according to CNN.
The poster boy for egregious bank fees was Bank of America, which was introducing a $5 per month fee for debit card users. Customers were outraged and many left. The bank eventually canceled the fee but, according to the Wall Street Journal, Bank of America is at it again with a new schedule of checking account fees.
Not official launch date
Currently, B of A is testing new fees in Arizona, Massachusetts and Georgia. Monthly fees for “Essentials” checking accounts range from $6 to $9, and other accounts are incurring monthly fees of $9, $12, $15 or $25.
However, certain things will get the fees waived, such as having a Bank of America mortgage or a minimum balance, just like current Bank of America checking account fees. Requirements to get fees waived may also change along with the new fee schedule, so Bank of America customers should pay close to attention to them. No start date has been announced yet, but the Wall Street Journal quoted a Bank of America insider who said the fees were going national “in a few months.”
Huge retail banks hurting
People don’t like to pay to use their own money. That said, Bank of America, Chase and similar institutions are raising fees for a reason.
The average checking account, according to Bloomberg, was found in a study by marketing research firm Javelin to cost $192 to $359 per year to administer. On top of that, federal regulations limit fees like interchange fees between banks and merchants and overdraft fees.
In the last quarter of calendar year 2011, according to Forbes, Bank of America’s revenue was down $400 million and JPMorgan Chase reported its annual income could decline by $600 million due to losses incurred as the result of regulations.
However, some recent comments from Chase, according to Time Magazine, are particularly telling. A Chase executive told investors that the bank wanted to double the $12 to $14 fees on basic checking accounts and that up to 70 percent of checking accounts of customers with deposits of $100,000 or less could become unprofitable.