BankBoston Announces Plan for ATM Noncustomer Convenience Fees in Massachusetts, Rhode Island and New Hampshire.

BOSTON--(BUSINESS WIRE)--Aug. 21, 1998--

-- Also Announces Significant Fee Reductions for Massachusetts Customers --

BankBoston today announced plans to begin collecting a $1 noncustomer convenience fee at its ATMs in Massachusetts, Rhode Island and New Hampshire. In conjunction with the announcement, BankBoston is introducing significant fee reductions for its own Massachusetts customers.

The bank also said it will provide full disclosure of the noncustomer convenience fee at all of its ATMs in those states, with an ability to cancel the transaction, and make its entire ATM network surcharge-free for customers from financial institutions that are members of its X-Press 24(R) network. BankBoston customers will not be charged this fee when using their BankBoston cards at any BankBoston ATM.

The new $1 noncustomer convenience fee, often called a surcharge or access fee, is designed to recover the increasing costs associated with servicing noncustomers, particularly at remote ATMs, which are more expensive to operate. BankBoston has a total of 1,507 ATMs in New England -- 1,276 in Massachusetts, 112 in Connecticut, 64 in Rhode Island and 56 in New Hampshire. The majority (809) are remote ATMs not attached to branches.

The convenience fee will be phased in beginning next week in New Hampshire and Rhode Island, to be completed over a two-week time period. BankBoston plans to start collecting the $1 noncustomer convenience fee in Massachusetts on Sept. 24. This fee will not apply to BankBoston ATMs in Connecticut due to current regulatory interpretations in that state.

In Massachusetts, the noncustomer convenience fee provides an opportunity for BankBoston to begin reducing select fees for its own customers who have been subsidizing the use of BankBoston's ATMs by noncustomers. In mid-October BankBoston will reduce the current fee it charges its own customers when they use another bank's ATM from $2 to $1.50. In anticipation of the noncustomer fee, BankBoston has just reduced its Student Value Package monthly fee from $6 to $3, including an electronic banking discount. The bank may consider additional fee reductions for Massachusetts customers that could be implemented in the future when there is a clearer understanding of changes in noncustomer transaction volume. The fees that are being reduced in Massachusetts are already lower in Rhode Island, New Hampshire and Connecticut related to the fact that BankBoston has fewer ATMs for customer use in those states.

Over the past year, one out of every four transactions at BankBoston ATMs was made by a noncustomer. BankBoston has spent $100 million over the past 10 years installing its ATM network and it spends nearly that much each year operating the network.

"This is great news for BankBoston customers who will be receiving even more value as BankBoston customers," said Thomas J. Hollister, executive vice president, Consumer and Small Business Banking. As a group, all consumers have benefited immensely from the convenience, flexibility and value offered by ATMs. Now with the ability to charge noncustomers a reasonable convenience fee, banks have an incentive to invest in more technology and provide even more convenient banking services for the benefit of all consumers."

The noncustomer convenience fee has existed in many parts of the U.S. since the 1980s. The fee has become more widespread as more machines -- at considerable cost -- have been added for the convenience of customers. Nationwide, over 70 percent of all banks charge noncustomers to use their ATMs. The fee exists in 48 states and averages about $1.30 per transaction.

The X-Press 24 network is a group of more than 70 Massachusetts banks and credit unions that utilize BankBoston's ATM-related services. Customers from these institutions will not be charged the new $1 fee when they use a BankBoston-branded ATM or any of the 174 X-Press 24 ATMs. Individuals using a state-issued card for electronic benefits transfer also will not be charged a fee.

BankBoston (NYSE:BKB), with assets of $70.5 billion and 23,000 employees, is the nation's oldest commercial bank and New England's only global bank. BankBoston is engaged in consumer, small business and corporate banking in New England; delivering sophisticated financial solutions to corporations and governments nationally and internationally; and full-service banking in leading Latin American markets. The Corporation's common stock is listed on the New York and Boston stock exchanges.

    CONTACT: BankBoston
              Bruce Spitzer, [phone]