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Dayton
Business Journal...
Fifth
Third
joins big banks seeking to replace lost fees
Monday,
April 30, 2012
Fifth Third
Bancorp is changing its strategy for how it charges fees to customers
as it
joins other banks across the country in seeking to replace lose fees,
according
to the Cincinnati Business Courier.
Fifth
Third, the largest bank in Dayton, launched four key products in the
past few
years, two of which CEO Kevin Kabat said are not available from any
bank
anywhere. And the revenue those products generate represents a major
change in
the way Fifth Third looks at the fees it charges customers.
“We’re
trying to move philosophically from charging punitive fees to
value-based
fees,” Kabat said.
U.S. banks’
service fees on deposit accounts have fallen 13 percent since December
2007,
according to a recent study by Market Rates Insight. Many industry
observers
blame regulations that have limited the amounts banks can charge
customers for
overdraft fees and the “swipe fees” they charge retailers when debit
cards are
used. And given that study’s comparison to 2007, the recession hasn’t
helped
matters, either.
In total,
those fees fell $5 billion during the past four years. Likewise,
revenue from
overdraft fees dropped $1.7 billion, or 5 percent, last year to $31.6
billion.
But
replacing that revenue with new fees is a tricky thing for many banks
that can
lead to PR headaches such as the one Bank of America
went through when it briefly added a $5
monthly fee for using debit cards.
Extra
charges for everything from cash withdrawals at ATMs to wire payments,
or
receiving paper statements are helping bring cash in at JPMorgan Chase,
Citigroup and U.S. Bancorp
, as well
as Bank of America. Some of the banks, including Chase and Citigroup,
have
upped their fee for checking accounts.
The Dayton
region is home to many of the big banks. Bank of America has several
home loan
branches in the Dayton region and last year bought the largest downtown
Dayton
office tower, while Chase ranks as the third-largest Dayton-area bank.
Read this
and other articles at the Dayton Business Journal
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