Keep The Change

KEEP THE CHANGE Faced with tougher post-bailout regulations, many banks have found new ways to make money - including controversial fees on debit cards. But as angry customers planned a 'Bank Transfer Day' for Nov. 5, banks suddenly bailed on that idea. Here's a look at how this ి rare consumer victory unfolded: What is an July 2010 Dodd-Frank Act signed into law, including "Durbin Amendment" July 2010 Wells Fargo ends free checking for new customers WELLS FARGO interchange fee? o “A fee charged by banks that covers the cost of Late 2010 Chase begins testing $3 monthly debit fee Sept. 2010 Citi adds handling and credit risk inherent in a bank credit CHASE O restrictions citì to free or debit card transaction." - Investopedia checking Jan. 2011 Bank of America adds restrictions to free checking Feb. 2011 U.S. Bank ends debit rewards • "The interchange fees that banks now charge usbank. program stores for debit trans- actions are economically and functionally identical to the check interchange fees prohibited by the Fed almost a century ago?" - Antitrust lawyer LIloyd Constantine, in an October 2011 New York Times op-ed June 2011 SunTrust begins $5 debit fee; ends free checking March 2011 Chase, Wells Fargo, PNC, Regions and SunTrust announce end of debit rewards SUNTRUST Sept. 2011 BofA unveils plans for $5 debit fee in 2012 Aug. 2011 Wells Fargo Bankof America WELLS FARGO announces Oct. test of $3 debit fee Oct. 1, 2011 "Durbin Amendment" takes effect Sept. 2011 Occupy Wall Street galvanizes public anger at banks How and why are they changing? Oct. 1, 2011 Regions unveils $4 debit fee Oct, 4, 2011 BofA customer Kristen Christian plans "Bank Transfer Day" for Nov. 5 REGIONS • The 2010 "Durbin Amendment" limits how much banks can charge retailers in interchange fees. The range is now 21 to 24 cents, down from an average of 42 cents in 2010 and 63 cents in 2002. Oct. 18, 2011 Bank Transfer Day gets 50,000O Facebook RSVPS in two weeks Oct. 28, 2011 Chase and Wells Fargo nix debit fees Oct. 31, 2011 SunTrust and Regions nix debit fees Nov. 1, 2011 Bank of America nixes debit fees How does this affect banks? BASIC CHECKING “[T]he Durbin Amendment will cost financial institutions Aside from debit cards, raised fees on services like basic checking. While some customers can waive these fees, ny banks have also $6.6 billion in revenues annually starting in 2012" - Javelin Strategy& Research they signal a shift away from the free checking accounts that became common in the 1990s. • "With the Durbin Amendment in effect, banks will still make 19c profit per processed transaction." - Kristen Christian, founder of Bank Transfer Day 2009 2010 2011 • On average, each U.S. 79% 65% 45% consumer makes 19 debit card transactions per month. - Federal Reserve of Boston Percentage of basic checking accounts at U.S. banks with no fees BASIC CHECKING FE ES* at five major U.S. banks: DATE November 5, 2011 PAY TO THE Chase 12.- ORDER OF Jwelve and DOLLARS Monthly fee Ima Customer MEMO ovember 5, 2011 PAY TO THE BBET u$10.- 00100 DOLLARS ORDER OF Jen and November 5, 2011 DATE PAY TO THE Crä ORDER OF $ 10.- 00%00 Jen and DOLLARS Monthe MEMO November 5, 2011 DATE ORDER OF Kegions Jen and PAY TO THE $10.- 0/00 DOLLARS Monthly fee Ima Customer MEMO PAY TO THE Bank of America $ 9. 0100 DOLLARS ORDER OF Nine and Many banks waive monthly checking fees for customers Monthly fee Ima Customer MEMO who meet certain requirements. BAILO UT MO NEY RECEIVED Federal bailouts received in 2008-09 by 10 major U.S. banks: Bank of America cíti CHASE O WELLS FARGO 24 $ $ $ 2. 45 billion 25 billion 25 billion 25 billion OPNC REGIONS SUNTRUST usbank. Capital One BB&T $. $. $. $. 7.6 billion 6.6 billion 4.9 billion 3.6 billion 3-5 billion 3.1 billion Includes $10 billion to Merrill Lynch before merger with BOA Sources: Investopedia.com, New York Times, Wall Street Journal, Javelin Strategy & Research, Federalreserve.gov, CardHub.com, CNN Money, International Business Times, Bankrate.com, Chase, BB&T, Citi, Regions, Bank of America, The National Information Center(NIC), Associated Press, Bank Transfer Day, Bloomberg, Consumerist, Kiplinger Infographic: Russell McLendon/MNN Design: Chris Rooney (@looneyrooneycom)/MNN mnn %24 %24 %24 %24