Jack TenneyExtra Point

by Jack Tenney, Publisher

November 1999

Bank mergers

You sold my what?

People are getting letters from their soon-to-be former bank wishing them well in their new financial relationships. Most of us have become accustomed to having our loan accounts swapped around like players-to-be-named-later. But now our checking accounts are in play, as big banks swallow up smaller banks in the process of becoming swallowed up, too.

For instance, because the VNB bought Vermont Fed and then got bought by the Chitt, some of the redundant branches are being sold to Charter One, the outfit that bought Albank, the buyer of Marble. Using a ZIP code directory and transaction analysis sample, checking accounts are assigned to a bricks and mortar location. If one of those locations is a future Charter One then the former VNB check writer is destined to become a Charter One check writer.

Rather than fret and fume about it, smarten up, go with the flow, get with the system. There are significant advantages to doing your banking without becoming personally involved in the process of dealing with bankers, tellers, chained-down ballpoint pens and lines.

First off, understand, since it's nearly impossible to have "a" bank, have a bunch. You can start this process without leaving the comfort of your easy chair. You want a credit card? Open the weekly mailing you get from BankOne. Or get an affinity card or two: college, frequent flyer, worthy charity -- they all have them. Take two, they're small.

After you have a few credit cards with different banks, figure out what local bank has a deal to fit your affinity group. You'll want a debit card your grocer likes so you can pick up peanut butter, a six-pack and $50 for the weekend. You can go for free checking, high-interest draft accounts, telephone banking, computer banking or all of the above. Don't forget the freebies and low-cost premiums: There are dollars-off greens fee coupons; travel discounts; two-for-one dinner deals and on and on. Sometimes you have to be a geezer like me to qualify for them (free travelers' checks, for instance); or others require minimum balances (five grand gets you a few more basis points on a CD; $25,000 for a sweep account; $80,000 for a sweep, extra checking account, two no-fee IRAs and discount brokerage.)

Never be satisfied. Financial services are commodities. Keep on the lookout for sales, promotions, freebies. This is especially true when it comes to borrowing money. If you're the sort of person who is used to paying your bills, there's a line of people willing to lend you money that goes twice around the block. You absolutely want a home equity line of credit with a low adjustable rate, conversion options to fixed rate that costs nearly nothing to open. No points, no closing costs, no appraisal fees and tax-deductible are the minimum perquisites you should accept.

Finally, make sure you get a cool calendar.