Bank of America -NT

[Golden Rocket]

The very mention of this institution engenders hostile reactions among most people.

With respect to the announcement of charging customers $60/year to use a debit card, how on earth do they expect to keep these customers? Are these customers so "captive" that they can't go somewhere else?

Remember, these are not deadbeat debtors, most of whom a bank will be happy to lose. These are people who prefer to pay "up front", so we are not talking about destitute people who do not have the capacity to make other arrangements.

I've labeled this as a Non-Topic but this is so engrained in economics that it is really in our own back yard, if not the front door.

[JohnH]

They are counting on other banks to follow their lead, and they are probably correct. The banking business long ago adopted a business model bases less on customer service and based more on squeezing every fee possible out of the customers. The big banks take the lead, and the small banks either follow suit or at some point get gobbled up by the big ones.

Also, they might be calculating that they actually make more money off you if you bank with someone else, especially if all you have with them is a checking account. If you carry a debit card from a credit union or a small bank that charges no monthly fee, what do you do when you need cash in a hurry? You generally hit the closest ATM machine and pay the $3 or so fee that it charges. BOA ATM's are fairly uniquitous, so they will get their proportional share of that business no matter who you bank with. A couple of those transactions a month will net them more money than charging you a single $5 fee for using the card all month, plus they don't have all the hassles of maintaining your checking account. Personal checking accounts are a money loser for most banks, even taking into account the fees they charge to maintain them.

I'm also betting that "high net worth" customers will find that the $5 monthly fee is waived for them, especially if they have investment accounts through the banks' brokerage services, because that's where the bank is really making the big bucks.

[BHoffman]

All the banks are going to be finding ways to cover their losses from the "Durbin Amendment".

Senator Durbin (D-Illinois) stuck an amendment into the Dodd-Frank bill, capping the amount banks could charge to retail stores who accepted debit cards at $0.24. This was very controversial. Since banks cannot continue to charge the seller, the consumer is the one left holding the bag. Wouldn't be quite so insulting if retail prices dropped accordingly, but don't hold your breath.

Here is an article that I think explained the Durbin Amendment well and includes a timeline and some advice on how to best respond to the fees:

http://money.usnews.com/money/blogs/my-money/2011/07/12/what-the-durbin-amendment-means-for-you

I thought this was just plain funny in an absurd sort of way:

http://thehill.com/blogs/on-the-money/banking-financial-institutions/184667-durbin-blasts-bank-of-americas-new-debit-fee

[veritas]

They are losing

thousands of customers. Seems silly to me. Those customers are going to take their credit cards, mortgages, car loans, investments with them.

Their internet site has been out of service since Friday.

[BHoffman]

BAC is below $6 per share and their website has been down for days. I wonder if that Countrywide merger has actually bankrupted B of A.

[taxmandan]

BAC is below $6 per share and their website has been down for days. I wonder if that Countrywide merger has actually bankrupted B of A.

If they put the foreclosed assets on their books at FMV they would be.

[AZ-Tax]

Complain YES, move to another Bank, a few

thousands of customers. Seems silly to me. Those customers are going to take their credit cards, mortgages, car loans, investments with them.

Their internet site has been out of service since Friday.

If a B of A customer has all of these products with B of A, not very likely many will change. Complain yes for a while but once the complaining period is over, most will stay. I have several clients who have several products with B of A and a few complained but none are leaving plus there is a pretty good chance if you have ALL these products with B of A, they may waive your $5 fee.

[AZ-Tax]

Nothing new, one of the 4 largest was down for 1-1/2 days

BAC is below $6 per share and their website has been down for days. I wonder if that Countrywide merger has actually bankrupted B of A.

The website of one of 4 largest banks in U.S. was down completely for 1 day and partially working the next day. I know, I have several accts there and for me who does nearly all my banking on line, what a hassle.

[veritas]

Your points are well taken

If a B of A customer has all of these products with B of A, not very likely many will change. Complain yes for a while but once the complaining period is over, most will stay. I have several clients who have several products with B of A and a few complained but none are leaving plus there is a pretty good chance if you have ALL these products with B of A, they may waive your $5 fee.

And I don't really blame them for imposing the fees since congress got their nose in the banks' business. Banks don't really want cash in bank accounts now since it costs them money for fdic insurance and so on.

But I think it is short sighted. They will run off tons of business and then eventually they will have another program to get them back. Maybe toaster ovens.

Or better yet a Glock!

[DTS]

If a B of A customer has all of these products with B of A, not very likely many will change. Complain yes for a while but once the complaining period is over, most will stay. I have several clients who have several products with B of A and a few complained but none are leaving plus there is a pretty good chance if you have ALL these products with B of A, they may waive your $5 fee.

I have nine accounts with a large national bank and they waive all fees knowing I'll close each account if I see anything that resembles a service charge, so we'll have complain more and those fees will be waived also.

[PIGLEE]

Last month my Credit Union started charging me 5.00. I called and asked why, They said they would reverse it if I used my Debit Card as a Credit Card, at least 10 times during the month. This made no sense to me until I heard what B of A did. It was not to long ago that they gave us a break if we used our debit card.

[BHoffman]

He meant well

Read more: http://www.politico.com/news/stories...#ixzz1ZmlHT4Zh


"Over the past few days, critics of the Durbin amendment blamed the Illinois Democrat for the debit fee hike. The Chicago Tribune, in an Oct. 1 editorial, dubbed the new charge the “Durbin Fee” and blasted the senator for pushing the swipe fee change.

" 'Durbin claimed that a cut in interchange fees would translate into lower prices and better service at Walmart and 7-Eleven,” the editorial read. “Funny, but no one’s handed us a free Slurpee yet.' ”

“What we are doing is fair to try to strike some balance in an industry that has shown little or no balance,” Durbin said. “And one of the worst offenders in this is Bank of America, the largest bank in the United States.”

[S T]

Another thought

Another thought that was posted at Forbes

http://www.forbes.com/sites/erikkain/2011/10/01/why-the-new-bank-of-america-debit-card-fees-are-a-good-thing/

A post that was to give awareness to transparency, and hidden fees that the consumer rarely sees or is aware of. - like the "swipe fee" at the retailer level - which of course is just added to the cost of the product that the consumer is purchasing.

Sandy

[oceanlovin'ea]

My daughter has a friend that works for Wells Fargo. She is so stressed out with her job. She told my daughter that they can't even order checks for a customer without filling out a page long inquiry about the customer's financial situation.When it is filled out, the customer service person takes it to their manager and he will give permission to order the checks or whatever the customer wants. If the customer complains or refuses, they are supposed to tell the customer that they can't help them at this time. If they want to close the account, let them do so. She said she had one manager yelling at a customer in her office.
She said they are only interested in "new" items. Keeping money isn't important. It is selling them some new service.
They have to make 20 contacts a day in between taking care of customers. She had only made 4 one day and they told her she had to stay till she did her 20 contacts. I don't know how long she stayed but if she had another job she would be quitting, I am sure.
That is just ridiculous. So far my credit union is not charging me for things and still takes care of my needs. But a credit union usually operates under different premises than a bank.

Linda, A

[Snaggletooth]

Who's the Villain?

With respect to the announcement of charging customers $60/year to use a debit card, how on earth do they expect to keep these customers?

I had someone today say that the Durbin bill was prompted by lobbyists from WalMart and other large retailers who ultimately will save $16 billion in bank fees. This sounds easy to believe except the retailers' fee is a negotiated percentage, which would have been a tiny percentage indeed for the WalMarts of the world. On the other hand, members of Congress almost NEVER legislate against the powerful banking lobby unless prompted by an equal or greater special interest. I doubt Mr. Durbin had the "Mom and Pop" grocery store in mind when he introduced his legislation.

So who's the villain? Bank of America with excalpatory fees? WalMart by having favorable legislation handed their way? I guess we're getting further and further away from taxes, and I am the guilty party. The sad truth is as tax preparers we all get sucked into economic issues. The best I can say for myself is I have at least avoided partisan politics.