BofA and JPMorgan Chase to Reduce Overdraft Fees (Wells Fargo too)

Kudos to JPMorgan who also announced it will end the practice of maximizing penalties by processing the largest purchase a customer makes first, draining accounts faster and creating the potential for multiple fees on smaller purchases.  



Update: Wells Fargo joins in Cutting Overdraft Fees - NYTimes

Banks' retreat on overdraft fees won't stave off legislation - MarketWatch

By Marshall Eckblad



NEW YORK (MarketWatch) -- The bank industry's signs of retreat on account fees may not satisfy Washington lawmakers, some of whom say they're pushing ahead with broad restrictions on fee policies at banks.



Bank of America Corp. /quotes/comstock/13*!bac/quotes/nls/bac (BAC 17.66, +0.16, +0.91%) and JPMorgan Chase & Co. /quotes/comstock/13*!jpm/quotes/nls/jpm (JPM 45.50, +0.44, +0.98%) , the two largest U.S. by assets, said this week they are reducing overdraft fees. Some regional banks, including Toronto-Dominion Bank /quotes/comstock/13*!td/quotes/nls/td (TD 63.95, -0.44, -0.68%) , PNC Financial Services Group Inc. /quotes/comstock/13*!pnc/quotes/nls/pnc (PNC 45.98, -0.88, -1.88%) and Fifth Third Bancorp /quotes/comstock/15*!fitb/quotes/nls/fitb (FITB 9.98, +0.13, +1.32%) , are also planning to change some of the ways they charge fees.



House Financial Services Committee Chairman Barney Frank (D-Mass.) said in an interview that he supports the moves by Bank of America and JPMorgan Chase. But Frank said he will still push forward with legislation requiring changes in overdraft policies at banks. The Federal Reserve is also considering strict curbs on overdraft fees that could be finalized later this year.



The policy change by the two giant banks "confirms that it's doable," Frank said. "No one else will be able to argue that it's too burdensome."



A spokeswoman from Senate Banking Committee Chairman Christopher Dodd's office (D-Conn.) said the senator is still moving forward with legislation.



Rolling back fees poses a high-stakes dilemma for banks.

The industry earned $39.5 billion from service charges on deposits last year, according to data from the Federal Deposit Insurance Corp. Fees for everything from ATM usage to balance transfers accounted for about 25% of the industry's total revenue, and are welcome as banks wrestle with losses from the the nationwide housing depression and severe U.S. recession.



Continue Reading at MarketWatch

Overdraft Fees, Chase, Bank of America, JP Morgan Chase, 39.5 Billion

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