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Money Minute: Bank profits up, new fees coming [Video]

March 01, 2012|By David Lazarus

Just what we need: more bank fees.

Bank of America is reportedly working on changes that would require many holders of basic checking accounts to pay a monthly fee unless they agree to bank online, buy more products or maintain certain balances.

This from the same bank that tried -- and failed -- last fall to impose a $5 monthly fee on debit-card users.

According to the Wall Street Journal, BofA is experimenting with charging $6 to $9 a month for an "Essentials" account. Other account options being tested carry monthly charges of $9, $12, $15 and $25 but give customers opportunities to avoid the fees by maintaining minimum balances, using a credit card or having a mortgage with the bank.

We've been hearing from banks for months that new federal regulations are cutting into their cash flow. Limits on how much they can charge customers for credit cards and overdraft protection will cost them billions, they say.

In reality, banks aren't hurting at all. Last year was the most profitable for the industry in five years, according to the Federal Deposit Insurance Corp.

Bank earnings rose in the October-December quarter to $26.3 billion, up 23% from the final quarter of 2010. For the full year, earnings rose to $119.5 billion, a 40% increase from 2010 and the most since 2006.

New fees? Yeah, that makes sense.

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