With rules and regulation still underway from the Dodd-Frank Act, major mortgage lenders face competition from credit unions as their public image wanes with segments of the population.[IMAGE]
Rising debit card fees drove some 650,000 consumers to credit unions over October, with social media movements responsible for galvanizing the exodus, according to a recent survey.
The ""Credit Union National Association"":http://www.cuna.org/ (CUNA) laid claim to the figures in a survey for which the trade group polled some 5,000 credit unions nationwide.
The consensus: CUNA members reported reaping $4.5 billion in new savings accounts with the influx of new members since late September.
In a ""statement"":http://www.cuna.org/public/press/press-release/issues/hundreds-thousands-of-consumers-billions-of-$$-move-credit-unions, the trade group attributed the migration to calls for a controversial $5 monthly debit fee by big lenders and a social-media inspired ""Bank Transfer Day"" that occurred in response.
""These results indicate that consumers are clearly making a smarter choice by moving to credit unions where, on average, they will save about $70 a year in fewer or no[COLUMN_BREAK]
fees, lower rates on loans and higher return on savings,"" said ""Bill Cheney"":http://www.cuna.org/cuna/bios/b_cheney.html, the trade group's president and CEO.
He said the largest credit unions ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô those with $100 million or so in assets ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô sopped up much of the inflow from financial institutions, with 70 percent accounting for the sizeable growth from late September onward.
""DowJones Newswires"":http://www.nasdaq.com/aspx/company-news-story.aspx?storyid=201111041346dowjonesdjonline000505&title=hate-your-bank-bank-transfer-day-is-saturday reported that art-gallery owner Kristen Christian struck the match that led to the backlash when she launched ""Bank Transfer Day"" on Facebook.
Lenders like ""Bank of America"":https://www.bankofamerica.com/, ""Regions Financial Corp."":https://www.regions.com/personal_banking.rf, and ""SunTrust Banks"":https://www.suntrust.com/ subsequently dropped the idea of a debit-card fee increase as it became more unpopular with consumers, according to ""_The Wall Street Journal_"":http://professional.wsj.com/article/SB10001424052970203707504577010291984996510.html?mg=reno-wsj.
A spokesperson for Bank of America did not immediately return a request for comment by e-mail.
_The Journal_ reported that big lenders went to consumers for help in making up fees lost as a result of the Dodd-Frank Act, which the newspaper said had slashed the amount of fees that financial institutions can charge over debit-card use.
The flock by consumers to credit unions marks the latest in a string of public relations problems for the nation's biggest banks, which continue to see unrest from populist movements like ""Occupy Wall Street"":http://occupywallst.org/.
Adding to their woes, an ""Office of the Comptroller of the Currency"":http://www.occ.treas.gov/ study reported that the draft version of the Volcker Rule ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô another Dodd-Frank provision - ""will cost financial institutions as much as $1 billion"":https://themreport.com/articles/occ-volcker-rule-will-cost-1b-for-banks-2011-10-28 in compliance-related expenses.
More recently, CUNA ""pitched itself into the fight over reform"":http://www.cuna.org/newsnow/11/wash110311-4.html in the secondary mortgage market, seeking to vie for access to originations as a proposal by ""Rep. Scott Garrett"":http://garrett.house.gov/ (R-New Jersey) generates more attention.