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Banks Could Increase Charges As They Attempt to Rebuild Profits

Banks Could Increase Charges As They Attempt to Rebuild Profits

Banks throughout the UK and other regions in Europe continue to face substantial losses. As they attempt to get their finances back under control, many people believe that they are going to be charging higher fees. They will likely face added pressure as new regulatory pressures.

Consultants from PricewaterhouseCoopers said that there is almost no way that banks would not begin creating new fees. However, they also said that the practice may not have to continue indefinitely. Another trend may counteract the increase in bank charges. As competition increases in the banking industry, banks are probably going to have to limit the fees they charge.

PricewaterhouseCoopers is not the only analyst to suggest such a trend. Another report was issued by the Confederation of British Industry. That report suggested that there was a significant fallout from the banking crisis in the Eurozone. As the debt crisis continues to infect the UK banking system, the local banks will need to find new ways to address it. The CBI report corroborates the findings of PricewaterhouseCoopers, further arguing that the banking crisis is going to get significantly worse. The only way they believe the banks can shelter themselves from the fallout in the Eurozone is to charge higher fees to their customers.

Over the most recent quarter, the banks posted much higher earnings. Nonetheless, austerity measures and the EU debt crisis are going to have a significant effect on the future of the banking system. Analysts have no way of predicting when there will be another major fallout and whether or not the banks will need to take more drastic action.

Regardless of how they intend on handling the crisis in the Eurozone, the banks are probably going to feel the need to charge more money as they try to increase their financial position. A number of different banks are still implementing a number of bank fees and even some of the newer banks are getting ready to start setting up programs that are going to charge their customers.

While Barclays and Santander continue to charge a number of fees to their customers, newer companies such as Virgin Money are also charging their customers for a number of the privileges they have instituted.

UK customers are still looking for alternative solutions. Many may consider transferring their accounts to credit unions the same way American customers did when they got frustrated with the fees they were being charged by Bank of America. However, these transitions are unlikely to happen overnight and they will probably be forced to contend with a number of high fees for the time being.

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