Year-Over-Year Decline Fueled by Continued
Enhancements to Overdraft Program, Including No-Overdraft Fee
SafeBalance® Account and the Elimination of
Non-Sufficient Funds Fees
CHARLOTTE, N.C., Aug. 17,
2022 /PRNewswire/ -- Bank of America today announced
that in June and July fees related to overdraft services for its
more than 35 million Consumer checking accounts declined 90%
compared to the same period in the prior year. June and July were
the first two months after sweeping changes related to these
services were implemented.
Earlier this year, the bank announced industry leading changes
that included the elimination of non-sufficient funds (NSF) fees
and the reduction of overdraft fees from $35 to $10. Clients
can also avoid overdraft fees altogether by choosing a SafeBalance
checking account, which now represents approximately 45% of new
checking account openings. Consumer client overdraft fees made up
less than 0.4% of the company's total revenue in the second quarter
of 2022.
"For more than a decade, Bank of America has invested heavily in
supporting our clients' financial health through industry-leading
solutions and ongoing enhancements to our overdraft services," said
Holly O'Neill, President of Retail
Banking, Bank of America. "Our scale, client focus and technology
investments have allowed us to adopt policies and innovate in ways
that help clients manage their everyday finances and liquidity
needs on their own terms, while also delivering for our
shareholders."
By next year, new solutions and enhanced programs introduced
over the last decade will reduce consumer overdraft fees by 97%
from 2009 levels.
Progress toward reducing overdraft fees
Since 2010, Bank of America has taken many steps to empower its
consumer clients to bank with greater confidence and reduce
overdraft usage. The company leads the industry in helping
clients avoid overdrafts and, in doing so, has significantly
reduced the vast majority of fees related to overdraft. Key
milestones along this journey have included:
- 2010 – Eliminated overdraft fees for consumer clients when
using debit cards at the point of sale
- 2011 – Introduced courtesy low balance alerts
- 2014 – Launched the SafeBalance "no overdraft fee" account
- 2017 – Eliminated the extended overdrawn balance charge
- 2020 – Created Balance Assist, a low-cost solution to manage
short-term liquidity needs
- 2021 – Launched Balance Connect , our enhanced overdraft
protection service, which lets clients link to up to five accounts
to avoid overdrafts
- Feb 2022 – Eliminated
non-sufficient funds fees on consumer deposit accounts
- Feb 2022 – Removed ability for
clients to overdraw their accounts at the ATM
- May 2022 – Reduced consumer
overdraft fees from $35 to
$10
- May 2022 – Eliminated Balance Connect for overdraft protection
transfer fee (formerly $12)
Essential Solutions
In addition to the changes to overdraft related fees, Bank of
America's suite of Essential Solutions offers a powerful
combination of transparent, low and no cost, easy-to-use offerings
that help clients budget, save, spend and borrow carefully and
confidently. The full array of solutions includes:
- SafeBalance® – With SafeBalance, there are no overdraft
fees, and the monthly maintenance fee is waived for eligible
students under the age of 25 as well as for clients enrolled in our
Preferred Rewards program with qualifying balances.
- Balance Assist – Balance Assist provides an affordable
way for clients to manage their short-term liquidity needs,
borrowing only the amount they need, up to $500 (in increments of $100) for a $5 flat
fee regardless of the amount borrowed. Repayments are made in three
equal monthly installments over a 90-day period. To learn more,
review these additional product details and eligibility criteria.
Borrowers must have been a Bank of America checking account client
for at least one year. More than 400,000 Balance Assist loans have
been completed since the start of the program.
- Balance Connect – Balance Connect allows our clients
overdraft protection through the ability to link up to five
accounts to their checking, while increasing simplicity and
accessibility through digital sign-up and management.
- Secured Credit Cards – The Customized Cash Rewards,
Unlimited Cash Rewards and BankAmericard® Secured Cards can help
clients establish, strengthen or rebuild credit, and they can apply
for an account with a security deposit starting as low as
$200. With responsible credit
behavior, over time, this could help clients improve their credit
score.
- Affordable Home Loans – In early 2019, Bank of America
launched its now expanded $15 billion
Community Homeownership Commitment, which has already helped 36,000
low- and moderate-income homebuyers achieve homeownership through
low down payment loans and down payment and closing cost grants. By
2025, Bank of America anticipates helping more than 60,000
individuals and families to purchase homes through the
program.
- Keep the Change® – This tool helps clients build savings
by automatically depositing spare change from rounded up debit card
transactions into a savings account. Over the last 15 years, this
program has helped clients direct more than $15 billion in excess change to client
savings.
- Better Money Habits® – A free financial education
platform that provides a simple, accessible way to connect people
to the tools, resources and education they need to take control of
their finances.
Recognized Leadership
Last year, Bank of America was recognized with more than 280
industry awards for its innovation, financial technology, and
delivering exceptional client services and solutions.
Forward-Looking Statements
Certain statements contained in this news release may constitute
"forward-looking" statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements represent the current expectations, plans or forecasts
of Bank of America based on available information. Forward-looking
statements can be identified by the fact that they do not relate
strictly to historical or current facts. These statements often use
words like "expects," "anticipates," "believes," "estimates,"
"targets," "intends," "plans," "predict," "goal" and other
similar expressions or future or conditional verbs such as "will,"
"may," "might," "should," "would" and "could." Forward-looking
statements speak only as of the date they are made, and Bank of
America undertakes no obligation to update any forward-looking
statement to reflect the impact of circumstances or events that
arise after the date the forward-looking statement was made.
Forward-looking statements represent Bank of America's current
expectations, plans or forecasts of its future results, revenues,
expenses, efficiency ratio, capital measures, and future business
and economic conditions more generally, and other future matters.
These statements are not guarantees of its future results or
performance and involve certain known and unknown risks,
uncertainties and assumptions that are difficult to predict and are
often beyond Bank of America's control. Actual outcomes and results
may differ materially from those expressed in, or implied by, any
forward-looking statements. You should not place undue reliance on
any forward-looking statement and should consider all of the
uncertainties and risks discussed under Item 1A. "Risk Factors" of
Bank of America's Annual Report on Form 10-K for the year ended
December 31, 2020, and in any of Bank
of America's other subsequent Securities and Exchange Commission
filings.
Bank of America
Bank of America is one of the world's leading financial
institutions, serving individual consumers, small and middle-market
businesses and large corporations with a full range of banking,
investing, asset management and other financial and risk management
products and services. The company provides unmatched convenience
in the United States, serving
approximately 67 million consumer and small business clients with
approximately 4,000 retail financial centers, approximately
16,000 ATMs and award-winning digital banking with
approximately 55 million verified digital users. Bank of America is
a global leader in wealth management, corporate and investment
banking and trading across a broad range of asset classes, serving
corporations, governments, institutions and individuals around the
world. Bank of America offers industry-leading support to
approximately 3 million small business households through a suite
of innovative, easy-to-use online products and services. The
company serves clients through operations across the United States, its territories and
approximately 35 countries. Bank of America Corporation
stock (NYSE: BAC) is listed on the New York Stock
Exchange.
For more Bank of America news, including dividend announcements
and other important information, register for email news
alerts.
Reporters May Contact:
Don
Vecchiarello, Bank of America
Phone: 1.980.387.4899
don.vecchiarello@bofa.com
View original content to download
multimedia:https://www.prnewswire.com/news-releases/bank-of-america-consumer-overdraft-fees-drop-90-in-june-and-july-following-industry-leading-changes-301607843.html
SOURCE Bank of America Corporation