Magazine article American Banker

Overdraft Revenue Begins to Rebound

Magazine article American Banker

Overdraft Revenue Begins to Rebound

Article excerpt

Byline: Kevin Wack

Overdraft revenue at banks and credit unions is rebounding a bit after a sharp decline that began in 2008, newly released data shows.

After falling to $31.1 billion in the third quarter of last year, annualized overdraft revenue rose 2%, to $31.8 billion, in the same period this year, according to data from Moebs Services.

"In the last six months, we have seen overdraft activity pick up," says Michael Moebs, chief executive officer of Moebs Services.

Annualized revenue from overdrafts peaked at $37.6 billion in the third quarter of 2008, and then fell by 1%, 9%, and 8% in the succeeding years.

The earlier fall in overdraft revenue came as some banks a under fire for reordering transactions in order to maximize such revenue a cut their overdraft fees. JPMorgan Chase (JPM), Wells Fargo (WFC), U.S. Bancorp (USB) and SunTrust (STI) were among the depositories that reduced charges. …

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