Tulsa World: Overdraft curbs may slash banking revenue by $15 million

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Overdraft curbs may slash banking revenue by $15 million

MONEY WOES
Poulos: Banning overdraft fees could be very costly to the banking industry.

By Staff and Wire Reports
Published: 11/25/2009 2:24 AM
Last Modified: 11/25/2009 4:52 AM

Limiting bank overdraft fees may cost the industry more than $15 billion in revenue and prompt lenders to impose new charges to close the gap, the head of Oliver Wyman's North American financial services business said.

"We're talking about $15 billion of revenue that basically falls right to the bottom line, so to take that out of the banking system then that's $15 billion of capital that is not being created," Oliver Wyman's Michael Poulos said in an interview Monday. "For some of our clients, this is a very big deal and it's not clear that regulators have thought everything through."

The Federal Reserve said earlier this month it will ban overdraft fees on automated teller machines or debit cards, unless a customer has agreed to pay extra charges for exceeding account balances. The crackdown follows criticism by lawmakers and consumer groups that bankers drove up fees by misleading consumers on terms of credit and debit cards.

By Staff and Wire Reports

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	Report Comment CrippledShark, San Antonio (11/25/2009 10:28:54 AM) Can't wait to see how BOK handles this one....... Happy Turkey Day, CS
	Report Comment A T Cox, Broken Arrow (11/26/2009 8:56:56 AM) If a bank takes our money (not theirs) and pays 4%, then lends that money out at 6% (not an unrealistic proportion), that's a gross profit of 50%. Do the math. Easy money. Should not need those punitive exorbitant overdraft fees.

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