Bank of America, (BofA), the
biggest retail lender in the US, is to introduce a variety of new
customer accounts in order to generate more revenue from its retail
business.

BofA said the new accounts
may include monthly fees or impose minimum balances as it moves
away from reliance on penalty fees.

BofA president and CEO Brian
Moynihan told analysts “We were too customer-friendly in terms of
the decision we made [on charging].”

He said that 10% of BofA
customers were paying 70% of the bank’s overdraft fees; that model
“was breaking and needed fixing.”

This led to complaints around
debit charges and complaints about deposits hitting an all-time
high.

Moynihan added: “We need to
do more work on pricing, more work on cost, more work on new
products.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

“So, in the end, the returns
and deposits will get back to the pre-regulatory change
levels.

“If customers’ choices
change, we will visit decisions we made to make sure that
shareholders get the return we need in this business.”

The effect of new financial
regulations was highlighted by BofA’s third quarter results: a net
loss of $7.3bn following a $10.4bn goodwill impairment charge
against its card unit.

“We are adapting to the
regulatory environment, credit quality continues to improve, and we
are managing risk and building up our capital,” added
Moynihan.