Friday, February 20, 2009


I read recently that Bank of America stock fell on fears that the government may take over the bank. I would be very happy to see this happen.

When I moved out to California in 1992, I needed a local bank. First, it was hard to do cross-country banking with my credit union. Second, I needed to establish residency, if I was going to spend a second year in school there. I chose Bank of America through a fairly simple process: I walked from my apartment to campus, and chose it because it had a branch along the way. I was very happy with BofA, and was a little bit sad to close my account when I moved to Georgia the following year. But in 1993, there weren't really national banks. So I set off with a rather large cashier's check locked in my glove compartment.

When I got to Georgia, I decided that I was going to put down roots by choosing a bank with some sort of local flavor in its name. The first one I came across, "Southern Heritage", seemed a little too flavorful for my tastes. (In Georgia, the word "heritage" is generally code for the Confederacy or for African-Americans. In this case, I think it was the former.) My next choice was "BankSouth," which seemed more like it.

I had a happy banking relationship with BankSouth, until shortly before I was about to leave Georgia, when they were swallowed up by NationsBank. First of all, this was an anti-competitive merger -- these were the two main choices in much of the South, so combining them didn't help the consumer. Secondly, NationsBank had completely awful customer service. They instituted a program where, when you called in or visited a branch, their computers would determine how profitable you were to them, so they could figure out whether or not to be nice to you. Also, after the merger, people in their branches were completely flummoxed by my attempts to pay my BankSouth car loan -- yet they refused to give me new loan coupons.

When I moved back to Maryland, I happily closed my NationsBank account, refinanced my car with the credit union and have not been a bank customer ever since. In the late 1990s, NationsBank took over Bank of America and appropriated its name. I guess they figured that they could erase their (deserved) reputation for bad customer service by buying the name of a bank with good customer service. If the entity responsible for all this gets wiped out, so much the better.

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