(snip)"Bank of America will charge clients new monthly fees if their accounts do not meet a minimum balance, the bank's CEO Brian Moynihan said on Tuesday.
"We will increase the account balance minimums or charge monthly fees in lieu thereof, which is the choice of the customer," Moynihan said at a Barclays Capital conference in New York.
These and other measures will allow the bank to compensate for revenue lost due to new regulations put in place following the 2008 financial crisis that led the US government to salvage many bank with massive bailouts, he said.
"Over the next 12 months, we will reset the entire product line." Bank of America has recently introduced a new account, called e-account, offering reduced fees for customers using automated services, while reducing the number of branches and staff in a bid to cut down costs, he added.
"That provides the customer with a choice, a monthly fee or to be served through automated means in these statements."
Automated transactions are growing at a rate of eight to nine percent a year while teller-based transactions are down five percent year over year, he said.
Moynihan said that new regulations passed by Congress in July and global banking regulations proposed on Sunday, in a bid to prevent future crises similar to the 2008 meltdown, may trim annual revenue. "(snip)
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Obviously the big banks will use these new regulations as justification to lower interest rates paid on savings accounts and/or institute new fee structures to help them defer the additional costs created by complying with these new regulations.
As to the strong push toward online banking, obviously banks will save on labor cost if human tellers can be reduced. However, the 'gold foil hat' crowd would also point out that it's extremely easy to stop any future 'bank run' if the bank simply shuts down it's online transaction website and ATM machines due to 'technical problems'. Thus if most bank customers opt for the no fee online banking only option, they are also making it much harder for themselves to withdraw cash from their accounts in the future !



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