Catching Up on Current Bank Fees

October 15, 2012 No Comments »
Catching Up on Current Bank Fees

Like the proverbial bad penny, bank fees have been popping back up here and there across the country since January of this year. The Dodd-Frank legislation made them possible again, and also – bankers say – put such pressure on bank profits that they felt compelled to bring back the fees.

Unfortunately, it’s very difficult to do a comparison of bank fees, because it always winds up like comparing apples and oranges. Start with Citibank, which, in December,  raised fees on some of its checking accounts. Monthly maintenance fees on the lender’s basic-checking accounts went up to $10 from $8. To avoid the fee, you have to keep at least a $1,500 balance in the account per month.  You can also set up direct deposit and pay at least one bill online each month in order to avoid the fees.

How does that stack up against Wells Fargo? Their customers in New York, New Jersey, Connecticut, Georgia, Delaware and Pennsylvania must pay a $7 monthly fee for a basic checking account if they receive paper statements and $5 if they select electronic statements. However, customers can get the fee waived if they direct deposit more than $500 in their account each month, or maintain a $1,500 balance.

Then compare that with Bank of America, which charges a $25 fee on premium checking accounts if the balance falls below a certain minimum?  Very basic checking now costs $6 to $9 a month, while  accounts with more privileges cost from $9 to $12. Customers can avoid the fees by maintaining minimum balances, using a credit card or taking a mortgage with the bank.

Which one would you prefer to bank with? While we’re supposed to have other alternatives, most banks are now charging something for checking.  According to Bart Narter, a senior banking analyst at consulting firm Celent, checking-account services cost the the banks an average of $300 annually per person industry wide, and most depositors with less than $3,000 aren’t profitable for lenders without fees including overdraft charges.

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