Banks playing games on fees.

I would like to provide a quick response to the recent national coverage of Bank of America, JPMorgan and Wells Fargo cutting some overdraft fees.

We analyzed our transactional data to determine what would happen if our credit union implement proposed changes outlined in the press coverage. Three scenarios were specifically reviewed:

* If the CU did not charge a fee for transactions that were less than $10. The result was a loss of 1% of our annual overdraft income.

* If the CU did not charge a fee if that the account balance was within $5 negative. The result was a loss of 1.5% of our annual overdraft income.

* If the CU charged for a maximum of four overdraft events per day. We found only twenty-five such events within one year's time.

I suspect banks will gladly let go of this small amount of fee revenue to gain the perception that they are softening their position in collecting overdrafts.

The truth, at least from our data, is that the consumer would be largely unaffected. The banks are smart to push this campaign. Banks were portrayed in a positive manner to a national audience by an uninformed media.

Kevin Scott

Operations Manager 

Texoma Community CU

Wichita Falls, Texas