Like many Average Joes around the country, I'm not too excited about some of the more esoteric business lines that US Big Banks have pursued in recent years. But that's not the subject of this post.
I feel like I've developed a relatively long list of grievances with big banks over the years. Some are nitpicky, and some are legit. I've had good service in getting things resolved at various times, and I've had some maddening experiences. I thought I'd share what I decided to do about it.
About a year ago I found the passbook from my first savings account, which was housed at a bank in Rogers Park (Chicago) that I think was located at Clark and Lunt, which would be very close to where both my parents were raised. I might be wrong about the corner, but it was within a few blocks of there. In any case, I only vaguely remember that bank, and I'll have to dig up the passbook to remember the name.
The first banks I remember "using" are Bell Federal Savings and Loan, and Elk Grove Bank. Bell likely had a branch in Rogers Park - I really only remember that passbook. As a kid, I spent some quality time playing around Elk Grove Bank while my Mom did her bank business, and we sometimes got to go visit the herd of transplanted elk across the street. I think I was more interested in just being in the bank, counting coins, being a kid. I have fond memories of that place. Then it was purchased by NBD (parent of National Bank of Detroit), as one result of the relaxing of interstate banking laws that occurred in the eighties(ish). The mid-90s saw the merger of First Chicago and NBD, which had both grown significantly by then. I worked downtown in Chicago, and had been banking with First Chicago for a while. That had become annoying, because they moved people through the branches so quickly that it felt like I had to establish new relationships on a monthly basis. Probably a good training ground for future bankers, but not great for customers. In fairness, my banking needs were pretty insignificant, so it never was more than "annoying". And if i was ever in Elk Grove, there was a branch. Not long after the First Chicago acquisition, the former Elk Grove Bank became part of Bank One, along with the rest of First Chicago NBD, etc. It's worth noting at this point that what became First Chicago was one of the very first National banks, as chartered under the National Banking Act during the Civil War. The Bank One merger marked the first time in over 130 years that "Chicago" was no longer a part of the bank's name. By now, though, it was a Really Big Bank. It then was folded into a Really, Really Big Bank: shortly after the Bank One/First Chicago merger, Chase Manhattan and JP Morgan merged, and the resulting JP Morgan Chase ultimately bought Bank One in 2004. Chase's commercial banking headquarters sits in Chicago, in the building that once only housed the First National Bank of Chicago.
Admittedly, I've meandered way off course, here, but I'm not editing, because I think my wandering monologue is instructive in terms of showing how far some banks have traveled from serving the immediate community. My point isn't that the reality is good or bad for society or anything so grandiose, just that it's our reality. Hang with me.
Around the time of the Bank One/First Chicago deal, my wife and I moved to Texas. If I recall correctly, Texas' banking laws were such that Bank One Texas and Bank One Illinois were very distinct, and we had to open new accounts and such, so we chose the bank that was closest to our new house, which wasn't part of Bank One. That particular giant bank just received a sizable capital injection from a very noteworthy investor, but I digress. We had a couple of minor annoyances while down there, but I don't remember the specifics. What I do remember is that my wife and I decided to move from Texas to Phoenix after a couple of years, and our still relatively new bank - one of the biggest in the US - lost a $55,000 check of ours, putting the closing of our new house in jeopardy. We pushed hard and escalated and didn't take "I don't know where it is" for an answer, before finally getting the check with less than an hour to spare before closing on the house*. We then summarily dismissed that institution as our bank of choice. We've never gone back to them.
Upon moving to Phoenix, we opened accounts with a large western Bank that had no branches in Chicago, but was actually older than First Chicago. Along with the other behemoths we had worked with, this bank has grown into a powerhouse through acquisitions and better balance sheet management than many of its peers. I have to admit that most of my experience has been positive, and we've had a "VIP" kind of relationship with them since we've been in Arizona that has meant low fees and reasonable service. Mostly, I don't interact with humans. The past couple of years, however, have brought on an incessant stream of "accidental" fees being assessed to our account. Typically, it's a monthly charge for the supposedly free VIP (not the real acronym!) relationship. But sometimes it's something else. Every month I call, and every month the fees are refunded without question. That in itself is suspicious. It's worth noting that I'm often transferred to a different department, and sometimes told that I have to go into a branch to get something reversed. I usually hang up and call back, and get an answer that works better for me. Nobody ever pushes back on my assertion that I'm entitled to a refund. It's just annoying that a) I get charged these things in the first place when I never had been charged before, b) I often get bounced around the phone before I can get resolution, and c) I'm forced to wonder if this is a new revenue center for the bank.
So where is all of this leading? Before I answer that, let's look back at the account that I closed in the bank that was the successor to my original Elk Grove Bank. I left several hundred dollars in the account when I closed it, and asked that they send me a check. They didn't close the account, and I think I lost track of the status for a while after we moved. Instead of sending me a check, they started deducting monthly fees from my account because I didn't have the requisite balance to avoid fees. Of course, I had requested account closure on multiple occasions, so it didn't make sense for me to have any balance. Eventually, the account went negative, and I got ornery. Things had become Kafkaesque. I figured out the email address of the bank's high-profile CEO and sent him an email asking him to fix the situation. I didn't bother with a detailed explanation. I used the words "embarrassing" and "absurd", which were almost euphemisms at that point. He forwarded the message to a member of his executive office, who replied to me the same day, credited me the fees, and closed the account. It took several years, but they move quickly in the CEO office. It's probably worth noting that I now have mortgages on a couple of investment properties with this bank, and that has gone smoothly. Their presence in both Chicago and Phoenix is a selling point. I went back to the former Bank of Elk Grove to open an account to make life easier for me whenever I'm in Chicago, and it was a good move.
Back to the point. After calling my primary Big Western Bank for the third or fourth month in a row to have errant fees reversed, I decided it was time to consider my options. I had been dealing with huge banks for many years, and thought it was worth trying a smaller bank. I don't want to sound overly naive or nostalgic (especially because this era must predated me), but the corner bank used to take deposits and lend money for local businesses and houses, and they generally actually knew their customers. Big Banks have their purpose, but that isn't what I need. So I did some research and opened a rewards checking account with Arizona Bank and Trust. At the time I think they had two branches, and they now have a whopping six, after the bank troubles of recent years. I'm paid over 3% on my checking account (subject to various requirements and limitations), and I pay no extra fees for anything, really. I even go into the branch with some regularity, and don't worry about getting charged for using the teller too many times. If I withdraw money at an ATM that is not at one of their six branches, they refund whatever fees I've paid. They're also affiliated with a big network of ATMs. But the thing that prompted me to write this post occurred just recently. Not too long ago, my wife started a new job and set up direct deposit with her employer. The first few checks hit the account a day or two after they were due. That was weighing on me, because I'd never seen a late direct deposit, and I was kind of wondering if I should be worried about the cash flow of this mid-sized public company, which didn't make much sense. In any case, her most recent check didn't show up for a couple of days, so I had her call the payroll department. They thought it might be a routing number issue, which it could not have been since the other checks had hit the account. They verified the account number, and I realized that two numbers were juxtaposed. I called the bank, and the very person who answered the phone said "oh yeah, Kevin, I saw that this morning and it's on my desk." Huh? She found it, fixed it, and I saw the money in our account less than an hour later. They had manually routed the funds to our account the previous 2 or 3 times. This was exactly my objective when I decided to hook up with a community bank. She didn't even have to make a call to track the issue down!
I’m not saying this is the best route for everyone. The retail branches of the Big Banks have an extensive reach, and I think that is valuable for a lot of people. They also tend to have very good web interfaces, because they have a lot of money to invest in technology, and there’s a lot of value in that. Nonetheless, I couldn’t be happier with my decision to trade the slick online banking interface for a serviceable one that comes with strong, personal customer support and zero fees.
* You may be wondering why we didn't just delay the closing of the house. This occurred over 12 years ago, in a much different real estate market. We had been building a house in Phoenix for 8 months, and most of that time was spent waiting on a framing crew. There was so much building going on that we had no real idea when the process would be complete, so we started our second Phoenix home search and bought an existing home a few blocks from where we had been building. That was the home on which we were closing. Clearly, the check wasn't lost forever, but missing our closing could very well have meant moving to Phoenix without a place to live. If they had found the check a day later, we may have been looking at starting a third search, and neither of us was very excited about that prospect.