Banks' behavior improves, study finds
Banks are doing a better job of informing consumers about the costs associated with their checking accounts, but more regulation is needed to ensure that the terms are fair and transparent, according to a report issued by Pew Charitable Trusts.
Pew researchers examined checking accounts offered by 36 of the nation's biggest banks, including how effective they were in providing clear cost disclosures and reducing incidences of overdrafts in which consumers are charged a fee for spending more than they have in their accounts.
Ninety-seven percent of banks received high marks in at least one category, although none got a thumbs up across the board. Ally Bank received the highest marks, followed by Charles Schwab, First Republic Bank, Citibank and Bank of America. On the low end of the scale were First Tennessee Bank, Sovereign Bank, Union Bank, KeyBank and First Niagara Bank, which was among four with Pittsburgh-area branches included in the report.
Fifth Third Bank and PNC tended to receive higher marks than RBS Citizens Bank and First Niagara.
First Niagara got low marks for its dispute resolution practices and disclosure of fees and other account information. RBS Citizens was graded poorly for its overdraft practices but graded well for dispute resolutions.
None of the four banks received above-average marks for overdraft practices, such as debit card use or dollar thresholds that trigger overdrafts.
Fifth Third scored best for its disclosure practices, while PNC received its best marks for dispute resolutions.
“While a majority of the banks improved, there is still lots of room for improvement,” said Susan Weinstock, director of the Safe Checking Project at Pew. “The Consumer Financial Protection Bureau can take action in a number of ways to clear up some of these problems with overdraft.”
The study is the latest by the nonprofit organization to examine the transparency of checking accounts in the aftermath of the financial crisis. Banks became increasingly reliant on a variety of fees charged to consumers as the economy sputtered. Lawmakers and advocacy groups complained that some institutions were raising fees and pinching consumers while receiving taxpayer bailouts.
The backlash led to changes in the way banks handle overdrafts. Banks, for example, can no longer automatically cover an overdraft deficiency and charge a fee if the customer has not opted in to such a program.
The Washington Post and Trib Total Media staff writer Thomas Olson contributed to this report.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Esmark sues Slovakian businessman for $100M, alleges sabotaged deal
- Changes on way to table
- Sales, profit rebound as American Eagle Outfitters returns to roots
- Cleveland district, including Pittsburgh, shows moderate economic growth in latest Beige Book report from Fed
- Exxon CEO: Low oil prices here to stay
- Transcripts show Fed’s fear of big bank aid
- Impact fees garner support from state community leaders
- Labor Department, nonprofit studies urge workplace injury system reform
- Concurrent Technologies focuses on developing batteries for renewable energy, electric cars
- Stocks fall further from record highs
- Pittsburgh gas pump prices up nearly 9 cents