Chillin' out till it needs to be funded
Even without the Durbin amendment which capped transaction charges on your Debit Card at $0.21 cents instead of the proposed $0.12 cents, is less than half you paid the term before at $0.44 cents and the income from the interchange fee still was 33% lower than the earlier quarter. However after the Durbin amendment comes into force yesterday/tonight, banks are unlikely to lose any of the assured fee income on their cards accounts.
BofA earns a clear $3 bln on Debit and Credit Cards in the 33:66 ratio and any reductions in interchange fee would be mor than compensated by new Debit Card charges incl an annual fee for holding the card itself.
The $5 / $10 fee would thus keep its cash registers ringing . Apart from the $3 bln from cards, the bank would also likely earn more than a billion from its 160 mln odd depositor base on standard checking accounts as no frills accounts are disdainfully dropped by the banks in ‘deference’ to the regulations of the new CFPRA
Reuters has a slightly lengthier take on the how and whys..