Large Bank Fees Sending Consumers to Smaller Banks

[Joanne98]

Disappointed by Bank of America Corp. credit card interest rate hikes and displeased by threats of new fees for basic services, Chuck Koplik of Lexington, long time customer of Bank of America for 33 years, has just decided to transfer $35,000 savings to Cambridge Savings Bank which offers higher interest rates and charges fewer fees.

Customers dissatisfied by the recent changes being imposed by larger banks have switched to smaller community banks and credit unions which offer better deals and incentives. Zogby International, an opinion research firm, has just found out in a survey that 14 percent of adult Americans have transferred their accounts to a community bank or credit union in 2009. Sixty percent of that group said that their main reason was to protest policies or behavior of large national banks, followed by lower service charges and better rates being offered by smaller banks. The next 26 percent of respondents said that they took their banking elsewhere, despite the inconvenience of doing so.

Taking advantage of the situation are area banks who found creative ways to lure dissatisfied customers. Lowell Cooperative Bank’s statement is “Getting Attacked by your Bank Fees?” while Cambridge Savings Bank ads state “SuperSmart Checking” offering an amazing 4 percent interest rate – during which time that the average checking account rate is .25 percent in the region. Marblehead Bank is giving away iPads in raffles to attract customers.

Karen Marryat, senior vice president at Cambridge Savings Bank said, they know there are customers who are disappointed about things going on in the banking industry. And it means opportunity for community banks like theirs.

The magnitude of the shift to smaller financial institutions that are reflected in the Zogby poll are hard to quantify. For example, Bank of America’s Massachusetts branch is not affected by the shift. Its market share increased to 22.22 percent this year from 18 percent three years ago according to the Federal Deposit Insurance Corp., despite the agency’s inability to track flow of funds between national and state-chartered banks.

However, Bank of America is in the middle of its own advertising blitz with 280 billboards in the Boston area to combat threats of erosion. Joseph L. Goode, spokesman, would not mention how much the company is spending but admitted that advertising is not enough to win again consumer trust. Goode said, they need to act in order to rebuild goodwill with Main Street. But consumers remain angered and just recently, Bank of America’s slogan in Jamaica Plain stated “ATMs everywhere I turn” was papered-over to read “Scams everywhere I turn” with the phrase “Above the law” added in front.

Officials from the largest banks in the U.S. have stated that financial revamp efforts and credit card regulation, including limits on overdraft charges and the fees banks charge merchants for debit card purchases, deeply affected their revenues, prompting them to saddle customers with new fees.

More consumer friendly local banks are now seizing on an opportunity to charm customers to switch. A Texas consulting group for small banks, BankVue said, the best way to make a small bank more attractive is by offering a “high yield checking account.” BankVue’s survey says, about 41 percent of the respondents are convinced that a generous interest rate was a powerful draw and enough to make them switch banks.

http://www.financialfeed.net/large-bank-fees-sending-consumers-to-smaller-banks/85825/

[dixiegrrrrl]

1. Can you hear us NOW, BOA?????????

[napi21]

2. I stopped using BIG BANKS a LONG time ago. Way back when

they made banking across state lines legal, all those big banks catered to the BIG depositors and treated their average users like sh*t! Instead of them improving over the years, they just got WORSE! I don't care if they ALL go away.

[AdHocSolver]

3. Instead of lowering fees or paying more interest, BOA spends millions on advertising...

...to convince people to bank with them. They must think people are incredibly stupid.

The best way to get the attention of the corporations is to smack them upside their wallets.

If your bank is ripping you off (and, with the connivance of the Fed, many of them do), find another bank or a credit union to do business with.

Stop buying cheap imported junk manufactured in low wage sweatshops. Buy American made products whenever possible. If you can't find anything but cheap imported junk in the stores, tell the management to offer American made products for sale and that you won't shop there until they do.

If you plan on waiting for our bought and paid for government to straighten out the economy you are going to be waiting a long time.

Contrary to what the pundits are saying, there has been no recovery from recession. Increases in GDP, stock prices, and corporate profits are NOT indicators of economic health for the REAL economy. Job losses, outsourcing, house foreclosures, long term unemployment, and small companies going out of business are the indicators of continued recession, not recovery. A long term recession becomes a depression.

Our economy can be saved from sinking into a depression only if Americans stop feeding the glutton corporations.