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Chase slips up
JPMorgan Chase CEO Jamie Dimon
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This week a JPMorgan Chase executive said that clients who have less than $100,000 in deposits are unprofitable for the bank. Sounds mean, but banks are doing their best to improve profits by pushing the less-than-wealthy toward digital banking. Fees are on the rise, too. Someone may have to fund the new luxury banking rooms Chase will construct so that the rich can bank in peace.
"If you're a customer of Wells Fargo, for instance, if you have less than three checking accounts, or you don't have a mortgage with the bank, they're going to charge you $15," says Marketplace's New York bureau chief Heidi Moore. "Citibank customers are being charged $20 per month unless they have $15,000 just sitting around in their accounts. A lot of these solutions are going to be very quiet, though. The banks don't want the same rebellion that Bank of America got when it talked about that $5 debit fee."
Click on the audio player above to listen to the full interview.
Does your expert reporter expect everyone to forget the fact that in addition to free bailout funding, Chase continues to receive 0% interest money from the Fed, which they then loan back to the taxpayer by buying treasuries at 2 to 3.5% interest? There is also the little matter of the big banks being allowed to continue charging these "unprofitable customers" interest on interest at usury rates as high as 30%!
Everything the two of you have stated here is ridiculous. We are providing a service to the banks, by letting them hold our money (in this present economy it is actually much safer at home). Your assertion to the contrary shows just how thoroughly you have been suckered by their propaganda. The real problem is that bank executives no longer have a reasonable business plan; in short they are incompetent (and they hope to make up for their incompetence by bleeding the suckers that they believe they see all around them).
Banks like other corporate entities (or people per the supreme court) need to make money. When interest rates are so very low, the spread between deposits and investments becomes low also. I.e., it's the government's fault - trying to save everyone, they dropped interest rates and printed money (money is a market also, when there is a lot of the stuff, why should you pay high interest to borrow, the market is flooded with the stuff). Insurance companies and retired folks should really be hollering, but, nary a peep. Anyhow, banks need to get paid, $100,000 accounts will do it apparently. But reversion to reasonable interest rates would do it as well. To fix one thing, the fed bollixed up a few other not insignificant aspects of financial life. I'm from the government, and I'm here to help you! R. Reagan
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The banks made a huge mistake. they forced their less well to do customers (the majority) to accept forced loans (an overdraft they would pay as a "courtesy" and charged a fee that at least for me frequently exceeded the overdraft itself tenfold.
the usual way this was addressed if one complained was somewhere along the lines of "well, if you used a ledger and weren't such a screw up you wouldn't have to pay them."
maybe that was true, before they started reordering your transactions, adding additional service charges for having been overdrawn in the past, refusing to pay the overdrafts even if it was only a dollar and then hitting you with 3 fees totalling over $100 and more i'm sure.
ever pay $205.00 because of a $5 dollar transaction?
I can't remember the exact numbers but basically my account reached below $10. I bought a single five dollar item and then the fee for being overdrawn the PREVIOUS month was assessed overdrafting the account further and using their reordering technique they then placed priority on their fee and started marching backwards through $1 transactions. by the time they were done all the fees totalled at least $200. by my ledger I had $2 left.
So I got a lil smarter and started watching for that $10 fee. it started moving around very deftly, took me a few months to actually figure out what they were doing. the date was always different but they always kept it about 2 days before paydayin the second or third week of the month. they were tailoring it to my buying habits with my lunches at work to catch me under $10 so they could set off another chain reaction right before my direct deposit would go in.
I was angry at myself for my seeming inability to manage my money for so many years. I have paid over $20,000 to a handful of banks in over drafts. then remarkably, I was sent an opt out letter from Chase which I promptly used to Opt out of their "courtesy" My account has still occassionaly managed to creep a dollar or 2 over from my card transactions that were somehow approved even though they weren't supposed to be or a bank fee that pops up with precedence and overdrafts my account for $6 or $10. However, the struggle just to feed my children has almost completely vanished since I am not losing a battle in a downward spiral anymore as the bank ratchets the percentage of my income up every week that they take in overdraft fees. Now, the 2 overdrafts I have had to pay in the last few months were actually my own fault because I wasn't paying attention. rather than 6 a month as punishment for just being poor.
I always said, "If you are going to force me to take out a loan at least charge me proper loan rates. (such as 14-19%" now I'm laughing at the infrastructure they built to deliberatly rob people that had it's teeth and claws ripped out by the opt out legislation. had they had reasonable fees, such as my suggestion, they'd still be making money off me today.
