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While you weren't looking, the banks were hoping the wave of Bank Transfer Day was done, gone, over. People who had not switched over to local banks or credit unions would not have done so. Memories are short. Aren't they?

It won't be clear for several weeks how many deposits moved to credit unions—the member-owned cooperatives that can't sell stock and don't pay taxes—on Bank Transfer Day.

And the people who left aren't important anyway. Aren't they?

Credit unions held just 8% of federally insured deposits as of June 30, compared with 70% for banks that have assets of more than $10 billion.

In the middle of the activity, big banks kept a low profile. Rather than have soundbites which might play through the weekend.

Chase refused a request for comment. Bank of America spokeswoman Anne Pace said in an e-mail, “We don’t have anything to share at this point on account closures.”

However, there is an industry report which lets them know what the future could hold.

Everyone won't leave. Not gonna happen.

How much do banks stand to lose if everyone moved their money out of banks? About $7.5 trillion, counting total deposits for all banks, savings and loans. However, that’s if everyone hopped the BTD bandwagon.
But consider that in the five weeks leading up to the weekend – ever since the Sept. 29 announcement by Bank of America about a $5 debit-card fee, which has since been rescinded – more than $4.5 billion has shifted from big banks into the nation’s roughly 7,000 credit unions alone, according to the Credit Union National Association (CUNA).

Trend spotting is what's going on now. Take the advent of social media. Overlay the economy, Tuesday's election, Occupy Wall Street, and a perceived mood. And you get the attention required to get power to pay attention.

That study is all about Bank Brand Vulnerability. No shock which one is on top. You already know. But it suggests the Vulnerability's reach could last longer than banks hoped.

The study indicates that $399 billion in customer deposits are in jeopardy (“in play”) at those 10 banks, and $185 billion of that amount is projected to exit in the next year. Of the 10 banks included in the study, Bank of America has the highest brand vulnerability, while PNC has the lowest.

In addition, Deutsche Bank has been looking into which banks would have the most blowback from increasing hidden fees to make up for the shortfall of the debit card fiasco.

It took Bank Transfer Day to remind people they have options regarding banking. The surprise within the banking industry is that door didn't close the Monday after the event.

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Comment Preferences

  •  Remember, too, that it can be a real bear (3+ / 0-)
    Recommended by:
    minvis, Nailbanger, Sylv

    to untangle finances from these banks.  A lot of folks started new accounts with credit unions this month but haven't been able to do the actual transfer yet.

    •  That is in fact our case (1+ / 0-)
      Recommended by:

      We opened an account at the local Credit Union last Saturday.  We will not have all of our money switched over until sometime early in December.

      We also have a savings account for our 13 year old son which we will be switching over as well.  This is a 13 year old that just had a Bar Mitzvah so the money we will transfer is not insignificant.

  •  let's hope so. (2+ / 0-)
    Recommended by:
    chipoliwog, Nailbanger

    I remember when...
    I opened my first savings and checking accounts. The bank gave me an engraved silver(plated) plate as a gift. Now they would charge me to loan them my money. Isn't the Invisible Hand of Obscene Greed a wonderful thing?

    A man, a plan, a canal, Panama

    by Karl Rover on Thu Nov 10, 2011 at 09:51:18 AM PST

  •  Questionable Methodology (0+ / 0-)

    Even if you assume that their projections for the percent of customers likely to switch in the next 12 months (based mostly on online polling) is accurate. I don't think this is a safe assumption, but let us pretend it is. They then just simply take that percent and multiply by the bank's total deposits. So if BOA has $407B in retail deposits and they "project" that BOA will lose 10.2% of their customers in the next year, they conclude that BOA will lose $42B. The problem is there are no crosstabs to determine the amount of deposits held by the 10.2% that are likely to leave. Therefore, the $185B number seems incredibly inaccurate, even if they are spot on with the number of customers leaving. It could be significantly more, or significantly less.

    Full study:

    Also, this research was done several months ago, so it doesn't take into consideration OWS, BTD or the general growing revolt against the large banks.

  •  I'm trying to google it (0+ / 0-)

    but didn't the entire banking crisis in September 2008 occur because $4 billion was withdrawn from banks over the course of several days? That's what led Bernake to bust into Congress and demand a bailout.

    Correct me if I'm wrong.

    "A cynical, mercenary, demagogic press will produce in time a people as base as itself." - Joseph Pulitzer

    by CFAmick on Thu Nov 10, 2011 at 10:51:39 AM PST

    •  I don't think you're correct (0+ / 0-)

      I believe the $4B you are referring to was the average amount. $150B was withdrawn from the money markets in 2 days in 09/08. Further, that wasn't from retail deposits. Finally, it was more Paulson than Bernanke that begged Congress for the bailout.

      •  Did we ever find out (0+ / 0-)

        who withdrew those funds?

        "A cynical, mercenary, demagogic press will produce in time a people as base as itself." - Joseph Pulitzer

        by CFAmick on Thu Nov 10, 2011 at 08:56:13 PM PST

        [ Parent ]

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