Big bank exodus?
Having a local bank as a client (Long Beach-based Farmers & Merchants Bank), we’re constantly educating ourselves on the banking industry and staying abreast of important trends. One current trend that’s catching everyone’s attention is the growing dissatisfaction from consumers over the “big banks”. Customers—fed up with constantly rising fees and faceless, impersonal service—are kissing the megabanks good-bye (BofA, Citibank, Chase, Wells, etc.) and taking their money instead to smaller community banks and credit unions.
Ironically, during this challenging economy when businesses are routinely shutting down, community banks are proliferating. These banks are often the partners of small local businesses, providing more than 35% of all loans under $1 million, according to the Small Business Administration. More than 8,500 community banks in the nation—comprising 98% of all banking institutions—are conducting business in 50,000 locations throughout the U.S.
Helping to fuel the big bank angst was the recent grassroots movement, Bank Transfer Day, which took place in November of last year. The group’s organizers encouraged big bank customers to move from their financial institutions and consider joining a credit union. It worked. Last year from September 29th through the first week of November, an estimated 650,000 consumers joined credit unions. There’s also the Move Your Money Project, a nonprofit campaign that encourages us to shun Wall Street, and helps us to create a more sane, stable and localized banking system.
A good deal of the recent anger stems from the poorly timed big bank plans to start charging customers a monthly fee for purchases made with a debit card. Although the banks have dropped those plans in light of widespread public outcry, most customers are still irate.
So, will the big bank exodus continue in 2012? We’ll see. In the meantime, we know a great community bank that we’re sure you’ll just love. Go to fmb.com to get started.
January 16, 2012