Citigroup, SunTrust, B of A, Wells Fargo decline comment on possible new fee for deposits

Unhappy with the airline industry’s leadership in fleecing customers by nickel-and-diming them to death, the big banks might just opt to start charging customers a “fee” for the honor of depositing money in your own savings account.

That’s been the chatter this past week, after the Federal Reserve raised the possibility of cutting a key interest rate it pays banks. The Fed is looking for additional ways to help stimulate the economy, including the possibility of providing banks an incentive to loan out their money, rather than just parking it at the Fed.

When a number of experts started wondering aloud as to whether this might cause banks to charge customers for making savings deposits, JP Morgan said no-way, while a number of other tops banks “declined to comment.”   Those mum on whether they might fleece their own customers including Citigroup, Bank of America, SunTrust, and Wells Fargo, according to USA Today.

Eliz-Warren-CNBCYou gotta love the banks.  Not satisfied with billion dollar bonuses, and hundred billion dollar bailouts, now they might just need to charge us to give them our money so that they can go and make even more money off of it.

And it’s so out of character for the big banks, who have been nothing short of the perfect corporate citizen these past many years since we saved their collective behinds.

Or not.

Who can forget the time that Bank of America was sued for allegedly rewarding its employees for pushing customers into foreclosure?

Then there were the LIBOR banks who colluded in an effort to make gobs of money at all of our expense.

And there was the time the Royal Bank of Scotland was set to pay nearly $1.5bn in bonuses after losing $1.7bn.

Or the time the big banks collectively got ready to pay out $65bn in bonuses just a year after we bailed them out.

Or the time the banks fleeced unemployed people.

Or the time the banks were refusing to release $208 million in relief for Hurricane Sandy victims.

And keep in mind, as Chris had reported a while back, the banks get every year from the federal government a subsidy of $780 billion, an amount equal to the entire multi-year stimulus for the rest of us. Elizabeth Warren got into this issue earlier this. Here’s of our reporting on that:

Elizabeth Warren got into this subsidy with Fed Chair Bernanke the other day at a Senate hearing, where Bernanke agreed with her that we ought to get rid of the subsidy.  And this was just the $83 billion estimate that they were talking about, not the newer, nearly ten times larger, $780 billion.

elizabeth-warrenElizabeth Warren: So I understand that we’re all trying to get to the end of “too big to fail.” But my question, Mr. Chairman, is until we do, should those biggest financial institutions be repaying the American taxpayer that $83 billion subsidy that they are getting?…It is working like an insurance policy. Ordinary folks pay for homeowners insurance. Ordinary folks pay for car insurance. And these big financial institutions are getting cheaper borrowing to the tune of $83 billion in a single year simply because people believe that the government would step in and bail them out. And I’m just saying, if they are getting it, why shouldn’t they pay for it?

Chairman Bernanke: I think we should get rid of it.

(I’m told that in order to actually see my Facebook posts in your feed, you need to “follow” me – so say the experts.)

CyberDisobedience on Substack | @aravosis | Facebook | Instagram | LinkedIn. John Aravosis is the Executive Editor of AMERICAblog, which he founded in 2004. He has a joint law degree (JD) and masters in Foreign Service from Georgetown; and has worked in the US Senate, World Bank, Children's Defense Fund, the United Nations Development Programme, and as a stringer for the Economist. He is a frequent TV pundit, having appeared on the O'Reilly Factor, Hardball, World News Tonight, Nightline, AM Joy & Reliable Sources, among others. John lives in Washington, DC. .

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30 Responses to “Citigroup, SunTrust, B of A, Wells Fargo decline comment on possible new fee for deposits”

  1. BillFromDover says:

    Not to mention: why do we constantly put up with this bullshit?

  2. BillFromDover says:

    It took me about 3 months to move my banking from Bank of America to a local credit union (verifying online bill payments et al.)

    The day I closed out my account I was directed to a bank manager who asked if there was a problem with my account.

    No sir, I smiled.

  3. Bluefire says:

    Back when I opened up my first account with a credit union you had to know someone who was a member…Family of group. But like you said, anyone can become a member and it’s worth it!

  4. LanceThruster says:

    Thanks, Ms. Warren, for reminding me why I need to close any accounts I have with these institutions.

  5. woodroad34 says:

    That’s the kind of thinking that made me leave BOA. It all started happening when ATMs were first introduced; first they charged you for using a live teller rather than an ATM and then when ATMs caught on they started charging a fee for that, too. Then they charged hidden fees if you didn’t keep your account at a certain level or if you had too many withdrawals in a month, etc. ad nauseum.

  6. judybrowni says:

    Yup, you and me both.

    For those who don’t know, if there’s a credit union in your neighborhood, or near where you work, you qualify as a member, not matter it’s affiliation.

  7. ArthurH says:

    You can always vote with your feet. Some years ago, the Chemical Bank of New York came up with “great” idea to cut costs. They told depositors that unless they maintained a $12,000 balance they could no longer do their banking with a live teller. They could only bank through an ATM. But after more than a thousand depositors decided that Chemical was toxic and moved their funds to other banks, the rule was dropped. It seems what they saved on letting go tellers they were losing on interest rates from loaning those lost deposits out.

  8. woodroad34 says:

    I haven’t put my money in a bank in almost 40 years since BOA stole my money through hidden fees (for which it was later fined and promised to never do it again). I do it all through a credit union. You can use ATMs throughout the country, if you’re worried about the lack of branches.

  9. Bluefire says:

    All the more reason to put your money into a Credit Union. Been a member since ’82.

  10. Hue-Man says:

    Don’t forget the huge tax refunds handed to the big banks so food stamps could be cut! Literally taking food out of the mouths of the poor to finance tax give-aways to hugely profitable banks…Banks are entitled but we have to cut the “entitlements” of the most vulnerable.

    “Many other companies [in addition to JP Morgan Chase] have benefited from the 2009 tax-refund law already. According to an analysis of securities filings by The Wall Street Journal, more than 250 companies have said they expect to get about $12 billion in federal tax refunds under the law.”

  11. lilyannerose says:

    Why don’t we just call them what they are? They are criminal cartels run by a bunch of thugs who are pretending that they are classy gents.

  12. Lawerence Collins says:

    I remember as a young kid hearing about the break up of the phone companies, I didn’t understand it then, I get it now! These banks need to be dismantled, quickly, Warren seems willing to do what few others will. I don’t know if she’d be able to beat Clinton in 16, but she has my vote if she runs!

  13. Catherine Tyler says:

    There is also a strict lending environment and layoffs will obviously affects
    the lending industry as well as the future approval processes. Small businesses
    have to work harder and efficient to bear the burden and leverage the
    opportunities available.
    IRA financing 401k Financing

  14. The_Fixer says:

    Well, theoretically, if you’re a member of a CU, then you have the right to attend annual meetings and let your concerns be known.

    Which is what you don’t get with banks. They make the decisions with no input from you. Oh, you can complain. And sometimes they will acquiesce, but keep in mind that’s only the stuff you’re likely to find out about.

    Credit Unions and banks that are small are the only way to fly.

  15. The_Fixer says:

    Yup, I’m in a credit union. I also think they’re safer, as they actually are regulated (due to the banks’ lobbying in an effort to lighten the competition).

    Ditto with the smaller banks. There was a story going around at the height of the banking crisis about a small Wisconsin bank that did business the traditional way and wound up growing nicely. They took in deposits, lent out those deposits to qualified people, who paid the loans back with interest. You know, the way banking is supposed to work.

    I saw the interview with the guy who headed up the bank. he was on the golf course by 3 every day. He was able to do that because he didn’t get involved in Credit Default Swaps and Options. He ran his bank the old fashioned way and it worked. Imagine that!

    Imagine if the big banks would adopt that business model.

  16. The_Fixer says:

    Shhh! You’ll give them ideas….

  17. pappyvet says:

    My Navy Credit union is run by [dare I say it] people. I do some times wonder about banks.

  18. pappyvet says:

    First WE loan the banks money for the express purpose of loaning it out……..and they don’t.
    Now we are looking forward to paying them for deposits. What’s next? An entrance fee?

  19. Fireblazes says:

    That mattress is looking better and better.

  20. karmanot says:

    It’s the remaking of the old bubble. The giant banks are 4x larger than before and playing by the same tricks. My guess that the ‘depressed’ housing market is a result of the ongoing depression and the Bank’s holding housing inventory for speculation—a part of the new bubble. I seriously believe not long after Obummer leaves office we will be facing a major depression. Most of us who park our savings in saving will lose big time.

  21. karmanot says:

    Go local—credit unions and small banks.

  22. perljammer says:

    This is probably not something your average retail bank customer needs to worry about. According to the USA Today article, they’re talking about the remote possibility of charging a fee to large business customers that hold millions of dollars in savings accounts, not charging grandma for harboring her meager nest egg.

    The Fed has an interesting challenge. They would like the banks to make more loans instead of parking their money. Am I crazy to think that the banks would like to make loans as well? After all, the current 30-year fixed mortgage rate of about 4.5% sure beats the 0.25% the Fed pays. When I refinanced my home, it took all of three weeks from my initial “I’m thinking about refinancing” phone call until the loan was funded; that tells me that banks are pretty eager to loan under the right circumstances. So, what’s keeping the banks from making more loans? Depressed housing market? Lack of qualified borrowers? Surely the Fed doesn’t want banks to resume the practice of tricking people into taking loans they can’t afford. I’m genuinely interested to hear what people here think about this.

  23. ArthurH says:

    Some of the big banks sure want to discourage thrift. When I was a kid, my local bank had a kids’ savers club that encouraged you to bank part of your allowance. Even if you had as little as $10 in your account they paid interest. By 1990, the bank, by then merged into a bigger bank was still paying 5.5% annual interest. And then it went to hell. Today the interest on savings is 0.38% and they charge you a monthly for the privilege of holding your money if the account is under $15,000. And now charging you to make a deposit? The banking industry has gone stark raving mad with greed!

  24. MyrddinWilt says:

    I don’t have a savings account at the bank, not at 0.0000001% interest.

    I don’t think any brokers charge for accounts and most will open an account for the same sort of initial funds as a bank requires. So why bother with banks for savings?

  25. Just_AC says:

    You touched on it, John, but didn’t shout it that, during the great bailout of 2008, the fed went to the big bankers and said
    “Hey we got a deal for you”
    The banks said “Really? What’s that?”
    The fed > “We’ll give you money – if you give it back to us, we’ll pay you interest on it”
    Banks said “Wow, we’ll do that all day long! Who wants to loan money and take a risk when we can get a guaranteed, risk free transaction

    So, go to Wikipedia and search for Excess reserves

    8 Billion for 50 years to 830 billion in three months to probably over two trillion now, tied up at the Fed and not being loaned out to expand and stimulate the economy

  26. A_nonymoose says:

    Yup. Credit unions are the way to go.

  27. Drew2u says:

    I’m glad I’m in a CU, but wasn’t there something up with credit unions, also? I thought they (maybe just mine) was trying to pull something kinda not-great a while ago.
    Still though, I’d rather be a part of a CU than any of the listed banks above!

  28. cole3244 says:

    i have been in a credit union for over 25 years and i’m glad i am.

  29. BeccaM says:

    All the more reason, wherever possible, to move your money to local banks and credit unions.

  30. eahopp says:

    Time to start cutting a hole in my mattress.

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