Bank of America warns of new fees after financial reforms

Published: Tuesday September 14, 2010

Bank of America will charge clients new monthly fees if their accounts do not meet a minimum balance, the bank's CEO Brian Moynihan said on Tuesday.

"We will increase the account balance minimums or charge monthly fees in lieu thereof, which is the choice of the customer," Moynihan said at a Barclays Capital conference in New York.

These and other measures will allow the bank to compensate for revenue lost due to new regulations put in place following the 2008 financial crisis that led the US government to salvage many bank with massive bailouts, he said.

"Over the next 12 months, we will reset the entire product line." Bank of America has recently introduced a new account, called e-account, offering reduced fees for customers using automated services, while reducing the number of branches and staff in a bid to cut down costs, he added.

"That provides the customer with a choice, a monthly fee or to be served through automated means in these statements."

Automated transactions are growing at a rate of eight to nine percent a year while teller-based transactions are down five percent year over year, he said.

Moynihan said that new regulations passed by Congress in July and global banking regulations proposed on Sunday, in a bid to prevent future crises similar to the 2008 meltdown, may trim annual revenue.

Bank of America was among the hardest hit during the credit crisis. It received 45 billion dollars in bailout funds from the federal government, and repaid the money last year.