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In Australia or Canada, where do you do your banking?
- Thread starter kakowi
- Start date
Australia do not have banks, they have loansharks.
There are the big 4 loansharks banks.
Commonwealth (CBA)
National (NAB)
Westpac
ANZ
Then, there are the second tier banks such as Bank of Queensland, BankWest, BankSA, Suncorp, Bendigo Bank, etc
All the banks are privatised. Commonwealth Bank used to be a government bank until the 1990s.
I go for HSBC and St George... service is good. Neddy is right, they are bloody loanshark.. hahaha
For Canada, you have a choice of:
a. CIBC - Canadian Imperial Bank of Commerce
b. TD - Toronto Dominion
c. RBS - Royal Bank of Scotland
d. HSBC
Hmmm.. HSBC seems to be accepted in many places..
I believe that the following chartered banks have offices in most of the major cities of Canada, except where indicated:
1. Bank of Montreal [BMO on the Toronto Stock Exchange]
2. Bank of Nova Scotia [BNS]
3. CIBC or Canadian Imperial Bank of Commerce [CM]
4. Royal Bank of Canada [RY]
5. The Toronto-Dominion Bank [TD]
6. National Bank (predominantly in Quebec, and with numerous offices in Toronto and Ottawa)
7. Laurentian Bank (same as National Bank)
8. HSBC (I believe it is a Schedule B bank, and not too long ago, purchased the operations of Household Finance)
There are many Schedule B banks with one or very few offices, which are not part of the main stream banking.
There are a few virtual banks, with no offices, where their customers conduct transactions via the internet: ING Bank, Citizens Bank.
There are numerous credit unions, where a majority originated from individuals working in similar industry (Power Workers Credit Union or was it Ontario Hydro Credit Union), (Toronto Board of Education Staff Credit Union - I was involved in this bankruptcy about 20 years ago), community (Ukrainian Credit Union), parishes (Slovenian Parishes Credit Union).
BankWest is good in its home state, Perth.
It is less of a loanshark. No account fees or fees for ATM, etc
Its transaction account has a saving interest rates up to $5000 and there is a overdraft facility.
The home loan product is also very competitive.
HSBC is a major bank in Australia as well.
Here again, the people who immigrated to Canada will not tell you the whole story because they were screwed by the banks there.
In Canada, you need to pay a fee to access your money. Everytime you use the ABM (ATM), everytime you write a cheque, everytime you use your debit card, everytime you see the teller to do a transaction, you pay a fee! Duh!
Fee ranges from 50cents to $1.75. Bert Kia in the newspaper article pay $1.25 for each transaction. Are you willing to pay the bank for accessing your own money? Would you pay the bank $1.25 for each time you withdraw your money?
Be cautious here, don't get screwed by the Canadian banks. The people who immigrated here were screwed and they don't want to tell us the whole story because if they do, would you come to Canada?
Why are bank fees so high?
Many Canadians are unhappy with bank fees in general, not just the fees for using another bank's cash machines highlighted by Finance Minister Jim Flaherty.
They think service charges are high and increasing all the time, despite the fact that many customers are adopting low-cost electronic banking.
They also feel they don't get a break from their banks for being long-time loyal customers.
"About 30 years ago, we had no fees," says Caroline Hubberstey, a spokeswoman for the Canadian Bankers Association.
"The cost of banking was covered off in the spread between loan rates and deposit rates. Borrowers paid for the banking activities of other clients.
"Today, we have lower spreads and we have a user-pay, transparent system."
Service fees from retail customers account for only about 5 per cent of bank revenues, according to a CBA publication.
Also, many customers pay no service fees because they take advantage of no-fee service packages for seniors or youth or because they maintain a minimum monthly account balance.
But with the shift to a user-pay system, there's an onus on you to scrutinize your bank statements and make sure you have the right service package.
If you snooze, you lose.
Take Bert Kea, a CIBC customer who doesn't go into his branch often. When he did so to get foreign currency, he was told that customers age 60 and over get many free transactions.
"The bank had my date of birth on file," says Kea, who was 64 at the time.
"How many customers like me are unaware that they have to notify the bank when they turn 60? How much is the bank making because of this policy?"
He had a savings account that offered two free transactions a month for those over 60 and charged $1.25 for each transaction (such as withdrawals and debit card payments). Meanwhile, the interest paid was only 0.2 per cent on balances up to $10,000.
Checking further, he found he would have been better off with a CIBC chequing account that offered free transactions and no monthly fee.
"In my opinion, if banks operated ethically, they would advise customers what was best for them," said Kea.
"Since I turned 60, I have paid an average of $20 a month in service charges and received between 66 cents to $1.75 in interest a month."
CIBC agreed to give him a refund of $72.50 for the two free transactions a month on his account, which he didn't get when he turned 60. He's since switched to a no-fee chequing account.
Faye Eriksen complained about the service charges paid by her daughter, a 20-year-old student.
"After Adriana's 19th birthday, Scotiabank converted her account to an adult account and started charging for each transaction – and the fees mounted," her mother said.
"While she did receive statements every three months, she didn't review the statements. That's where she's clearly at fault and I was the first person to tell her that."
The student noticed the change only when she found her account was overdrawn. Then, she asked her mother for help.
"I pay only $8.50 total a month for the three accounts I maintain at my own bank," says Eriksen. "Charging more than double for one account for a student is ridiculous."
Scotiabank did not agree that Adriana Eriksen was entitled to a refund of all service charges paid, which added up to $263.64 for an 18-month period.
The bank said it provided information on her student account's conversion to an adult account, both in a booklet and in a letter sent before she turned 19.
"Adriana told us she does not read all her mail and never checks her bank account statements," said spokesperson Frank Switzer.
Customers can use a calculator available in branches or online to make sure they're getting value for their banking, Switzer added. Or they can call a banking officer for help.
Lisa and Wade Snow also spotted the service charges on their RBC Action Direct account only when they were in the red.
Their RRSP account had held 89 shares of Bombardier Inc., worth about $410 at current prices.
"Admittedly, we do not scrutinize our monthly statements, other than to check on the value of the stock," says Lisa Snow.
"So, we were surprised to get a letter from RBC, saying our account was overdrawn by $187.17 and we should take immediate action or it would liquidate enough securities to cover the amount owed."
The Snows weren't aware of a $50 account management fee, which would have influenced their decision to maintain the RBC account after moving most of their investments elsewhere.
The fee applies to all RRSP accounts with a balance of less than $25,000, said Beja Rodeck, an RBC spokesperson. It's intended to offset administration costs.
Last June, the fee for accounts with less than $25,000 was increased to $75 (from $50).
Clients would get notified by letter once a year if their accounts were overdrawn by $100 to $200, Rodeck said.
"We encourage all clients to practice diligence in reviewing their monthly statements and other financial information on a regular basis."
Robert Willard, a TD Canada Trust customer, got a shock when he asked for help resolving a personal income tax issue. He wanted copies of 12 monthly Visa statements from 2003.
"I was told there would be a charge of $120 and said that was ridiculous. Without missing a breath, the young lady said, `I think I can do that for $60.' I said `no, thank you' and hung up."
Willard wrote to TD Visa to complain about what he felt was gouging of a long-time customer. Now 64, he's been with the bank since he was 20.
"About one week later, I received a sympathetic phone call from TD Visa, assuring me that I was indeed a valued customer and the documents would be sent to me immediately for $2 each.
"If that had been the response when I first called, I wouldn't have squawked (even though $24 for a few bytes of information stored on a disk in a file somewhere still seems exorbitant)."
Kelly Hechler, a TD Financial Group spokesperson, said the fee for a duplicate statement is normally $10.
TD considers such fees discretionary, since customers have the choice of ordering old statements and paying for them or not. More recent statements can be viewed for free online.
"It is highly unusual for a customer to order an entire year's worth of old statements, which is why the fee added up," she said.
"Recognizing this, and in acknowledgment of our relationship with the customer, our representative made the decision to lower the fee significantly in this case."
Willard's experience shows that banks are open to negotiation. He persisted and won two fee cuts.
Long-time customers usually can get concessions if they follow up with the bank, but it takes time and effort.
A CIBC client, for example, received a cheque from a lawyer for $227,000 after selling his house. He put the money into an account that paid no interest (a CIBC waive account, no longer available).
"The bank should have noticed that when the money was deposited and called to notify me and suggest alternatives," says the man, who preferred not to be named.
"To me, this is called service – and I didn't get it, even though I've dealt with this bank branch for 30 years."
Rob McLeod, a CIBC spokesperson, said the bank tried to contact the client sometime afterward. But he was out of town and had no message system on his phone.
Eventually, the client was compensated for having a large balance sitting in a no-interest account for 70 days.
"The bank did relent and cough up at least some interest," said the man, still angry about not getting a call right away. He later moved everything to another bank.
Switching banks is tedious and you don't want to do it too often. But if you're not getting treated with the respect due to a long-time customer, that's the best way to way to fight unwarranted charges or low interest rates.
In Canada, you need to pay a fee to access your money. Everytime you use the ABM (ATM), everytime you write a cheque, everytime you use your debit card, everytime you see the teller to do a transaction, you pay a fee! Duh!
Fee ranges from 50cents to $1.75. Bert Kia in the newspaper article pay $1.25 for each transaction. Are you willing to pay the bank for accessing your own money? Would you pay the bank $1.25 for each time you withdraw your money?
Be cautious here, don't get screwed by the Canadian banks. The people who immigrated here were screwed and they don't want to tell us the whole story because if they do, would you come to Canada?
Why are bank fees so high?
Many Canadians are unhappy with bank fees in general, not just the fees for using another bank's cash machines highlighted by Finance Minister Jim Flaherty.
They think service charges are high and increasing all the time, despite the fact that many customers are adopting low-cost electronic banking.
They also feel they don't get a break from their banks for being long-time loyal customers.
"About 30 years ago, we had no fees," says Caroline Hubberstey, a spokeswoman for the Canadian Bankers Association.
"The cost of banking was covered off in the spread between loan rates and deposit rates. Borrowers paid for the banking activities of other clients.
"Today, we have lower spreads and we have a user-pay, transparent system."
Service fees from retail customers account for only about 5 per cent of bank revenues, according to a CBA publication.
Also, many customers pay no service fees because they take advantage of no-fee service packages for seniors or youth or because they maintain a minimum monthly account balance.
But with the shift to a user-pay system, there's an onus on you to scrutinize your bank statements and make sure you have the right service package.
If you snooze, you lose.
Take Bert Kea, a CIBC customer who doesn't go into his branch often. When he did so to get foreign currency, he was told that customers age 60 and over get many free transactions.
"The bank had my date of birth on file," says Kea, who was 64 at the time.
"How many customers like me are unaware that they have to notify the bank when they turn 60? How much is the bank making because of this policy?"
He had a savings account that offered two free transactions a month for those over 60 and charged $1.25 for each transaction (such as withdrawals and debit card payments). Meanwhile, the interest paid was only 0.2 per cent on balances up to $10,000.
Checking further, he found he would have been better off with a CIBC chequing account that offered free transactions and no monthly fee.
"In my opinion, if banks operated ethically, they would advise customers what was best for them," said Kea.
"Since I turned 60, I have paid an average of $20 a month in service charges and received between 66 cents to $1.75 in interest a month."
CIBC agreed to give him a refund of $72.50 for the two free transactions a month on his account, which he didn't get when he turned 60. He's since switched to a no-fee chequing account.
Faye Eriksen complained about the service charges paid by her daughter, a 20-year-old student.
"After Adriana's 19th birthday, Scotiabank converted her account to an adult account and started charging for each transaction – and the fees mounted," her mother said.
"While she did receive statements every three months, she didn't review the statements. That's where she's clearly at fault and I was the first person to tell her that."
The student noticed the change only when she found her account was overdrawn. Then, she asked her mother for help.
"I pay only $8.50 total a month for the three accounts I maintain at my own bank," says Eriksen. "Charging more than double for one account for a student is ridiculous."
Scotiabank did not agree that Adriana Eriksen was entitled to a refund of all service charges paid, which added up to $263.64 for an 18-month period.
The bank said it provided information on her student account's conversion to an adult account, both in a booklet and in a letter sent before she turned 19.
"Adriana told us she does not read all her mail and never checks her bank account statements," said spokesperson Frank Switzer.
Customers can use a calculator available in branches or online to make sure they're getting value for their banking, Switzer added. Or they can call a banking officer for help.
Lisa and Wade Snow also spotted the service charges on their RBC Action Direct account only when they were in the red.
Their RRSP account had held 89 shares of Bombardier Inc., worth about $410 at current prices.
"Admittedly, we do not scrutinize our monthly statements, other than to check on the value of the stock," says Lisa Snow.
"So, we were surprised to get a letter from RBC, saying our account was overdrawn by $187.17 and we should take immediate action or it would liquidate enough securities to cover the amount owed."
The Snows weren't aware of a $50 account management fee, which would have influenced their decision to maintain the RBC account after moving most of their investments elsewhere.
The fee applies to all RRSP accounts with a balance of less than $25,000, said Beja Rodeck, an RBC spokesperson. It's intended to offset administration costs.
Last June, the fee for accounts with less than $25,000 was increased to $75 (from $50).
Clients would get notified by letter once a year if their accounts were overdrawn by $100 to $200, Rodeck said.
"We encourage all clients to practice diligence in reviewing their monthly statements and other financial information on a regular basis."
Robert Willard, a TD Canada Trust customer, got a shock when he asked for help resolving a personal income tax issue. He wanted copies of 12 monthly Visa statements from 2003.
"I was told there would be a charge of $120 and said that was ridiculous. Without missing a breath, the young lady said, `I think I can do that for $60.' I said `no, thank you' and hung up."
Willard wrote to TD Visa to complain about what he felt was gouging of a long-time customer. Now 64, he's been with the bank since he was 20.
"About one week later, I received a sympathetic phone call from TD Visa, assuring me that I was indeed a valued customer and the documents would be sent to me immediately for $2 each.
"If that had been the response when I first called, I wouldn't have squawked (even though $24 for a few bytes of information stored on a disk in a file somewhere still seems exorbitant)."
Kelly Hechler, a TD Financial Group spokesperson, said the fee for a duplicate statement is normally $10.
TD considers such fees discretionary, since customers have the choice of ordering old statements and paying for them or not. More recent statements can be viewed for free online.
"It is highly unusual for a customer to order an entire year's worth of old statements, which is why the fee added up," she said.
"Recognizing this, and in acknowledgment of our relationship with the customer, our representative made the decision to lower the fee significantly in this case."
Willard's experience shows that banks are open to negotiation. He persisted and won two fee cuts.
Long-time customers usually can get concessions if they follow up with the bank, but it takes time and effort.
A CIBC client, for example, received a cheque from a lawyer for $227,000 after selling his house. He put the money into an account that paid no interest (a CIBC waive account, no longer available).
"The bank should have noticed that when the money was deposited and called to notify me and suggest alternatives," says the man, who preferred not to be named.
"To me, this is called service – and I didn't get it, even though I've dealt with this bank branch for 30 years."
Rob McLeod, a CIBC spokesperson, said the bank tried to contact the client sometime afterward. But he was out of town and had no message system on his phone.
Eventually, the client was compensated for having a large balance sitting in a no-interest account for 70 days.
"The bank did relent and cough up at least some interest," said the man, still angry about not getting a call right away. He later moved everything to another bank.
Switching banks is tedious and you don't want to do it too often. But if you're not getting treated with the respect due to a long-time customer, that's the best way to way to fight unwarranted charges or low interest rates.
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You are not making accurate claims! ATM charges are levied on chequing accounts but not on savings accounts.
Here again is someone is trying to confuse you.
Go open a savings account in Canada, withdraw some money from the ABM and see if the bank will charge you a fee for that transaction.
These people will do anything to sweeten the screwups. Don't get deceived.
If you are not the type who is willing to pay bank fees, go to other western countries with no bank fees
Here we have the country's Finance Minister and Prime Minister debating on high bank fees, particularly those super high ATM charges, we have people here who is still denying the fact that you have to pay for each transaction you make at the Canadian Banks :(
Bank-fee showdown
Federal Finance Minister Jim Flaherty talked tough to the banks, but we're still paying the fees.
Political observers were surprised when Flaherty championed an issue first raised by the NDP – that banks are gouging Canadians with fees for withdrawing money from bank machines where they are not customers.
Even Prime Minister Stephen Harper joined the debate this month. "I can say that, like every other Canadian, when I do get them from time to time, they annoy me," he said.
The high-profile showdown is more about perception than policy, say some political experts.
"The objective of this is to make them look caring. It's optics," said Nelson Wiseman, political science professor at the University of Toronto.
"It's not the inclination of this government," Wiseman said of Flaherty's call for lower fees.
The key issue is whether customers should pay to use automated teller machines at banks where they don't hold an account – those pesky $1.50 charges.
In the fractured political landscape of a minority government likely heading into an election, it is one of the few issues where the NDP, the Liberals and the Conservatives are on the same page – more or less.
The issue of high fees at ATMs has rumbled across the country in recent weeks, moving from the business pages to the front of local and national newspapers.
Sizzling bank profits are adding fuel to the fire of those opposed to the fees. Combined, Canada's six-largest banks turned out a record $19 billion in profits last year, up from $6 billion in 2002.
"The profits can be viewed as bad news," said Ian Nakamoto, financial services analyst at MacDougall, MacDougall & MacTier. "They can be viewed as a red flag for those who want to make political hay with some of the financial institutions."
In January, federal NDP Leader Jack Layton launched an offensive on banks when he said: "Average Canadians are getting nickel and dimed by the big, chartered banks."
He said his party would table an amendment to the Bank Act that would eliminate fees.
Liberals backed up the NDP but have since asked for a thorough investigation of all automated tell machines, and not just those owned by the banks.
Finance committee hearings looking into the fees are expected to start Thursday.
With Parliament in recess, Flaherty earlier this month made the trek to Toronto to meet bankers on their turf and make his plea.
Over a 90-minute lunch at the Fairmont Royal York Hotel, Flaherty and two of his staff presented their case. The banks didn't shy away, with five of Canada's six biggest sending their chief executives. Present were Royal Bank's Gord Nixon, TD's Ed Clark, CIBC's Gerald McCaughey, BMO's Bill Downe and National Bank's Real Raymond. Scotiabank was represented by its head of domestic personal banking Chris Hodgson, since chief Rick Waugh was in Halifax preparing for Scotia's annual shareholders' meeting the next day.
There was a noticeable change in Flaherty's tone after he emerged from the meeting.
The bluster turned to diplomacy and demands turned to wishes. "I would like to see some specific consideration given to persons who are lower income," he told reporters.
He said he had a frank and direct conversation with the bankers, and expected them to address the issues he raised.
But the bankers held their ground. "If people use banking services one way or another, people pay for banking services they use," said Scotiabank's Waugh the next day.
"That's the way we have to run a very profitable, very safe and very efficient bank. That's why Canadian banks are successful. I think that's a good thing."
A spokesperson for Flaherty yesterday said the minister is awaiting a response from the banks on the fee issue. Flaherty wasn't available for comment.
With the banks appearing to dig in, it's not clear if the Conservatives have scored any points among voters.
"It's a good issue for them (the Conservatives) to resolve for the electorate," said Daniel Drache, a political science professor at York University. "They're often perceived, as they drift to the right, of giving the corporate agenda a leg up. They need issues that have a more direct impact on individuals and families."
If ATM fees were eliminated, customers would be subsidizing the customers of other banks who use their machines, argues the Canadian Bankers Association. If people want to forego the convenience fee, they should use their own bank's machine.
The banks argue government intervention would lead to less service for Canadians.
"ATMs provide liquidity and liquidity has a cost," says Nadia Massoud, finance professor at the University of Alberta.
But banks don't seem to have convinced either the broader public or their political masters why a fee is necessary.
John Lawford is one lawyer eager to argue against the banks in upcoming finance committee hearings.
"There is no need for fees at all," says Lawford, who represents about 4,000 Canadians through the Public Interest Advocacy Centre. Banks collect an estimated $154 million annually in convenience fees, based on figures supplied by the Canadian Bankers Association – a tiny sliver of their overall profits. But it's an issue that gets Canadians' blood boiling.
Flaherty has two options: change the Bank Act or try to use public opinion to put pressure on banks.
He could eliminate the convenience fees by following Layton's suggestion and amend the Bank Act.
The Bank Act will be reviewed next month – as it is every five years – and now would be as good a time as any to rule against the convenience fees. But few think that will happen.
"There's not a lot of precedence for regulating price, it's not the way our economy works," says Peter Hamilton, corporate lawyer at Stikeman Elliott LLP.
Industries that are regulated often have a flaw that makes them unable to compete under regular market conditions.
"Automatic bank machines are not a candidate for industry regulation," says Laurence Booth, University of Toronto finance professor. There are five large banks in Canada, there's plenty of competition and convenience fees are not critical to the economy, he says.
Should the government choose not to use regulatory red tape, that doesn't mean it is powerless to abolish convenience fees.
If the Bank Act remains intact, there is another way to get change – moral suasion.
"The government has significant influence over the banks," says Robert Elliott, lawyer and partner at Fasken Martineau DuMoulin LLP.
"They will put pressure on the banks to change despite there not being a legislative basis to lower fees."
That could be done during tougher executive meetings with the banks.
But if the government were successful at getting the banks to eliminate fees, it might not solve consumers' pocket-book problem.
Banks might just shift the fees to another service, says U of T's Booth. Previously, banks raised service fees to recoup losses on 1970s loans to foreign countries such as Brazil, Argentina and Mexico, he says.
The United Kingdom might have no convenience fees, argues the Canadian Bankers Association, but U.K. customers pay more for other services.
In addition to shifting fees, the banks could use court action.
In 1999 Santa Monica and San Francisco banned ATM fees, arguing the charges were unfair to the elderly and the disabled. But in 2003, the U.S. Supreme Court refused to hear an appeal of lower court rulings that overturned the citywide bans.
Academics, analysts and bank executives say the issue has become politicized.
Perhaps if it weren't a minority government the issue wouldn't have snowballed and caused a media maelstrom – or caught the attention of Flaherty.
Will the issue be resolved by an election expected before the summer?
It's not an easy call.
"(The Conservatives), of course, have their ideas of deregulation and privatization and a hands-off government," says York professor Drache.
"But I think their ideology is less important than their hunger for votes. We don't know if this government has the political courage to say no to the banks and slap them on the wrist."
Bank-fee showdown
Federal Finance Minister Jim Flaherty talked tough to the banks, but we're still paying the fees.
Political observers were surprised when Flaherty championed an issue first raised by the NDP – that banks are gouging Canadians with fees for withdrawing money from bank machines where they are not customers.
Even Prime Minister Stephen Harper joined the debate this month. "I can say that, like every other Canadian, when I do get them from time to time, they annoy me," he said.
The high-profile showdown is more about perception than policy, say some political experts.
"The objective of this is to make them look caring. It's optics," said Nelson Wiseman, political science professor at the University of Toronto.
"It's not the inclination of this government," Wiseman said of Flaherty's call for lower fees.
The key issue is whether customers should pay to use automated teller machines at banks where they don't hold an account – those pesky $1.50 charges.
In the fractured political landscape of a minority government likely heading into an election, it is one of the few issues where the NDP, the Liberals and the Conservatives are on the same page – more or less.
The issue of high fees at ATMs has rumbled across the country in recent weeks, moving from the business pages to the front of local and national newspapers.
Sizzling bank profits are adding fuel to the fire of those opposed to the fees. Combined, Canada's six-largest banks turned out a record $19 billion in profits last year, up from $6 billion in 2002.
"The profits can be viewed as bad news," said Ian Nakamoto, financial services analyst at MacDougall, MacDougall & MacTier. "They can be viewed as a red flag for those who want to make political hay with some of the financial institutions."
In January, federal NDP Leader Jack Layton launched an offensive on banks when he said: "Average Canadians are getting nickel and dimed by the big, chartered banks."
He said his party would table an amendment to the Bank Act that would eliminate fees.
Liberals backed up the NDP but have since asked for a thorough investigation of all automated tell machines, and not just those owned by the banks.
Finance committee hearings looking into the fees are expected to start Thursday.
With Parliament in recess, Flaherty earlier this month made the trek to Toronto to meet bankers on their turf and make his plea.
Over a 90-minute lunch at the Fairmont Royal York Hotel, Flaherty and two of his staff presented their case. The banks didn't shy away, with five of Canada's six biggest sending their chief executives. Present were Royal Bank's Gord Nixon, TD's Ed Clark, CIBC's Gerald McCaughey, BMO's Bill Downe and National Bank's Real Raymond. Scotiabank was represented by its head of domestic personal banking Chris Hodgson, since chief Rick Waugh was in Halifax preparing for Scotia's annual shareholders' meeting the next day.
There was a noticeable change in Flaherty's tone after he emerged from the meeting.
The bluster turned to diplomacy and demands turned to wishes. "I would like to see some specific consideration given to persons who are lower income," he told reporters.
He said he had a frank and direct conversation with the bankers, and expected them to address the issues he raised.
But the bankers held their ground. "If people use banking services one way or another, people pay for banking services they use," said Scotiabank's Waugh the next day.
"That's the way we have to run a very profitable, very safe and very efficient bank. That's why Canadian banks are successful. I think that's a good thing."
A spokesperson for Flaherty yesterday said the minister is awaiting a response from the banks on the fee issue. Flaherty wasn't available for comment.
With the banks appearing to dig in, it's not clear if the Conservatives have scored any points among voters.
"It's a good issue for them (the Conservatives) to resolve for the electorate," said Daniel Drache, a political science professor at York University. "They're often perceived, as they drift to the right, of giving the corporate agenda a leg up. They need issues that have a more direct impact on individuals and families."
If ATM fees were eliminated, customers would be subsidizing the customers of other banks who use their machines, argues the Canadian Bankers Association. If people want to forego the convenience fee, they should use their own bank's machine.
The banks argue government intervention would lead to less service for Canadians.
"ATMs provide liquidity and liquidity has a cost," says Nadia Massoud, finance professor at the University of Alberta.
But banks don't seem to have convinced either the broader public or their political masters why a fee is necessary.
John Lawford is one lawyer eager to argue against the banks in upcoming finance committee hearings.
"There is no need for fees at all," says Lawford, who represents about 4,000 Canadians through the Public Interest Advocacy Centre. Banks collect an estimated $154 million annually in convenience fees, based on figures supplied by the Canadian Bankers Association – a tiny sliver of their overall profits. But it's an issue that gets Canadians' blood boiling.
Flaherty has two options: change the Bank Act or try to use public opinion to put pressure on banks.
He could eliminate the convenience fees by following Layton's suggestion and amend the Bank Act.
The Bank Act will be reviewed next month – as it is every five years – and now would be as good a time as any to rule against the convenience fees. But few think that will happen.
"There's not a lot of precedence for regulating price, it's not the way our economy works," says Peter Hamilton, corporate lawyer at Stikeman Elliott LLP.
Industries that are regulated often have a flaw that makes them unable to compete under regular market conditions.
"Automatic bank machines are not a candidate for industry regulation," says Laurence Booth, University of Toronto finance professor. There are five large banks in Canada, there's plenty of competition and convenience fees are not critical to the economy, he says.
Should the government choose not to use regulatory red tape, that doesn't mean it is powerless to abolish convenience fees.
If the Bank Act remains intact, there is another way to get change – moral suasion.
"The government has significant influence over the banks," says Robert Elliott, lawyer and partner at Fasken Martineau DuMoulin LLP.
"They will put pressure on the banks to change despite there not being a legislative basis to lower fees."
That could be done during tougher executive meetings with the banks.
But if the government were successful at getting the banks to eliminate fees, it might not solve consumers' pocket-book problem.
Banks might just shift the fees to another service, says U of T's Booth. Previously, banks raised service fees to recoup losses on 1970s loans to foreign countries such as Brazil, Argentina and Mexico, he says.
The United Kingdom might have no convenience fees, argues the Canadian Bankers Association, but U.K. customers pay more for other services.
In addition to shifting fees, the banks could use court action.
In 1999 Santa Monica and San Francisco banned ATM fees, arguing the charges were unfair to the elderly and the disabled. But in 2003, the U.S. Supreme Court refused to hear an appeal of lower court rulings that overturned the citywide bans.
Academics, analysts and bank executives say the issue has become politicized.
Perhaps if it weren't a minority government the issue wouldn't have snowballed and caused a media maelstrom – or caught the attention of Flaherty.
Will the issue be resolved by an election expected before the summer?
It's not an easy call.
"(The Conservatives), of course, have their ideas of deregulation and privatization and a hands-off government," says York professor Drache.
"But I think their ideology is less important than their hunger for votes. We don't know if this government has the political courage to say no to the banks and slap them on the wrist."
Re: Bank Charges in Canada
It all depends when you opened your account with a financial institution. My wife pays a $2 flat fee per month for her account. I pay zero, not even for printing cheques, and cheques which are negotiated. I also negotiated a fee of $2 per month for all my trust accounts, in addition to the bank charges for printing cheques Charlie9 in trust for xyz.
If you do not wish to pay any fees, the credit unions are good alternatives.
It all depends when you opened your account with a financial institution. My wife pays a $2 flat fee per month for her account. I pay zero, not even for printing cheques, and cheques which are negotiated. I also negotiated a fee of $2 per month for all my trust accounts, in addition to the bank charges for printing cheques Charlie9 in trust for xyz.
If you do not wish to pay any fees, the credit unions are good alternatives.
Australia do not have banks, they have loansharks.
There are the big 4 loansharks banks.
Commonwealth (CBA)
National (NAB)
Westpac
ANZ
Then, there are the second tier banks such as Bank of Queensland, BankWest, BankSA, Suncorp, Bendigo Bank, etc
All the banks are privatised. Commonwealth Bank used to be a government bank until the 1990s.
More like legalized loansharks
Re: Bank Charges in Canada
What bank are you and your wife using?
Credit Unions at one time has no fee or cheaper fees but now credit Unions charges a fee as well. There is no free lunch in Canada, nothing comes free here
What bank are you and your wife using?
Credit Unions at one time has no fee or cheaper fees but now credit Unions charges a fee as well. There is no free lunch in Canada, nothing comes free here
No such thing lah. Canadian Banks charges by Debits and not type of accounts.
Debits are debit transactions ie withdrawal, cheque writing, ATM withdrawal etc
Wow! It looks like staying in S'pore and banking with POSB?DBS is the best.
People who complain about banks in Singapore have heard nothing about the cut throat banks in Canada.
Take Royal Bank, one of the biggest bank in Canada, on the high end account, their RBC VIP Banking charges $30 a month while their low end account, RBC Day to Day Banking charges $4 a month but each transaction would cost 50 cents.
RBC VIP Banking
$30 per month
Unlimited Debits
RBC Day to Day Banking
$4 per month
15 free debits, after which 50 cents for each debit
ATM Withdrawal non RBC $1.50 per withdrawal
Generally, most Canadian banks charges 50 cents to $1.00 per transaction while ATM transactions are from $1.50 up :(
Re: Bank Charges in Canada
It just happened that when I started work in Toronto in 1981, the firm which employed me, was in the same building as BMO (First Canadian Place).
I have always banked with BMO. My personal account is supposed to be $15 per month, but the bank gives me a credit every month, unlimited cheques and transactions.
My wife's account is also with BMO. She had it since she was a university student, where it was free if you mainain a minimum balance of $1,000. But later the bank converted or "grandfathered" her to an account where the monthly fee of $2 covers unlimited cheques and transactions.
What bank are you and your wife using?
Credit Unions at one time has no fee or cheaper fees but now credit Unions charges a fee as well. There is no free lunch in Canada, nothing comes free here
Originally Posted by Charlie9
It all depends when you opened your account with a financial institution. My wife pays a $2 flat fee per month for her account. I pay zero, not even for printing cheques, and cheques which are negotiated. I also negotiated a fee of $2 per month per account for all my trust accounts, in addition to the bank charges for printing cheques Charlie9 in trust for xyz.
If you do not wish to pay any fees, the credit unions are good alternatives.
It just happened that when I started work in Toronto in 1981, the firm which employed me, was in the same building as BMO (First Canadian Place).
I have always banked with BMO. My personal account is supposed to be $15 per month, but the bank gives me a credit every month, unlimited cheques and transactions.
My wife's account is also with BMO. She had it since she was a university student, where it was free if you mainain a minimum balance of $1,000. But later the bank converted or "grandfathered" her to an account where the monthly fee of $2 covers unlimited cheques and transactions.
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