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No Surcharge ATM Alliance in California Grows

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The nation’s largest credit union EFT network and at least six other California institutions formed a ‘No-Surcharge ATM Alliance’ yesterday. CU Cooperative Systems Inc. and Union Bank, Coast Federal, Glendale Federal, Sanwa Bank, Sumitomo and Bay View Federal Bank jointly announced their participation. Totally 2,100 ATMs are covered in the alliance including 791 in the greater Los Angeles area, 348 in the San Francisco Bay area, 328 in metropolitan San Diego and about 500 in the Central Valley. Member’s ATM machines in neighboring states will also be included in the alliance no-surcharge policy.

Meanwhile Washington state legislators heard testimony yesterday from credit union presidents and community bankers urging passage of SB5813 which would temporarily defer ATM surcharges to give small banks and credit unions more time to reestablish independent ATM networks.

FULL STORY:
CU Cooperative Systems Inc. — THE CO-OP — joins “No-Surcharge ATM Alliance”
CU Cooperative Systems Inc. (THE CO-OP), the nation’s largest credit union electronic funds transfer (EFT) network, Tuesday announced it has joined with six other California financial institutions to offer ATMs without surcharges, according to Robert Rose, president and CEO of THE CO-OP.

Members of the new alliance, in addition to THE CO-OP are: Union Bank of California, Bay View Federal Bank, Coast Federal Bank, Glendale Federal Bank, Sanwa Bank California and Sumitomo Bank of California.

In total, the “No-Surcharge ATM Alliance” includes more than 2,100 ATMs, most of which are in California. There are 68 alliance ATMs in Utah, 34 in Arizona and additional machines in 13 other states, including Oregon and Washington. THE CO-OP’s 1,360 ATMs in Arizona, California, Florida, Idaho, Nevada, New Mexico, Texas, Utah and other states will be included in the alliance.

“This Alliance is good for our credit unions and, most importantly, good for credit union members,” Rose said.

Initially, there will be 791 no-surcharge ATMs in the Los Angeles/Orange County area, 348 in the San Francisco Bay area, 328 in the San Diego metropolitan area, and 570 in other California locations, including the Central Valley.

Rose said the driving philosophy behind this alliance is that the long-term strategic interest of both the credit union and banking industries are best served by encouraging use of facilities such as automated teller machines.

“THE CO-OP’s more than 3 million credit union cardholders will now find enormous added convenience with a broad choice of ATM locations throughout California,” Rose said. “Most importantly, our members will be able to utilize those ATMs without incurring a controversial surcharge.”

Additional financial institutions are expected to join the alliance within the next month, further extending the available options. Alliance members have adopted a common logo developed and used by THE CO-OP members which will be displayed on the participating no-surcharge ATMs over the next month. This logo is currently displayed on more than 850 ATMs on THE CO-OP network.

Organized in 1981 to fill a need among credit unions to have their own reliable ATM network, THE CO-OP serves more than 320 credit unions and more than 3 million cardholders in Arizona, California, Florida, Idaho, Nevada, New Mexico, Texas, Utah and other states, and currently provides more than 1,360 ATMs in their region. THE CO-OP processed more than 126 million transactions in 1996. THE CO-OP’s headquarters is located in Pomona, Calif.

Sumitomo Bank of California Joins No-Surcharge ATM Alliance

Sumitomo Bank of California announced today that it has joined an alliance of financial institutions offering surcharge-free ATM usage.

Faced with increasing public outcry over rising fees being charged for ATM use, a group of California financial institutions have formed an alliance which will allow their customers to use alliance member ATMs without being assessed a surcharge which a few major California banks began charging non-customers in the fourth quarter of 1996. This surcharge is in addition to the standard interconnection network charge.

Members of the new alliance include Bayview Federal Bank, Coast Federal Bank, Glendale Federal Bank, Sanwa Bank California, Union Bank of California, and Sumitomo Bank of California. In addition, the CU Cooperative System, Inc., a service provider for more than 1,300 ATMs and 300 credit unions in the western U.S., has committed its own network to the alliance. In total, the alliance will have a network of more than 2,100 ATMs in California, Oregon, Washington, Utah, and Arizona.

“By forming this alliance, we can now offer our customers a vast and affordable ATM network comparable to larger banks while maintaining a comfortable size that allows us to continue to offer highly personalized service,” proclaimed Ole B. Larsen, Executive Vice President and Manager of Sumitomo’s Branch Banking Division. “Rather than choosing a strategy of mergers and acquisitions to expand our facilities, we chose to engage in a cooperative effort with other financial institutions. We believe that our customers are the ones who will truly benefit,” he added.

Alliance members agree that the driving philosophy behind this effort is that the long-term interests of the banking industry will best be served by encouraging the use of facilities such as automated teller machines. Yukio K. Kitagawa, head of Public Affairs for the Bank, commented that “we are well aware of the public’s reaction to banks who have restricted teller window transactions in an effort to increase ATM usage, singing praises that the reduced costs would be passed along to consumers, only to later raise their ATM fees. This alliance not only encourages the use of ATMs, but makes it affordable to do so.”

Alliance member institutions have adopted a common logo which will be displayed on participating no-surcharge ATMs. Locations of these ATMs will also be publicized.

Sumitomo Bank of California, headquartered in San Francisco, has just under $5.0 billion in assets and operates 47 branches throughout California.

Center> Coast Federal Bank joins effort to oppose ATM surcharges

Coast Federal Bank has joined the newly-created “No Surcharge ATM Alliance,” a group of commercial banks, thrifts and credit unions that have collectively agreed not to impose a surcharge on non-customers who use their ATMs.

The Alliance has been created in response to the extra fee, recently adopted by Bank of America, Wells Fargo Bank and other financial institutions.

“We want people to know that they have a choice between those ATMs that surcharge and those that don’t,” said Robert L. Hunt II, Coast’s president and chief operating officer. “By joining together, the Alliance members have created an extensive network of over 2,000 ATMs that do not impose these excessive fees on non-customers.”

Previously, a person was charged a single fee when using an ATM owned by a bank where he or she was not a customer. This fee — typically $1 or more — was paid to the STAR or PLUS ATM networks, which then paid a portion of the fee to the person’s bank and to the bank owning the ATM. (STAR or PLUS ATM networks provide the electronic link allowing a customer of one bank to use an ATM owned by another.)

Recently, however, B of A, Wells Fargo, Great Western Bank and others — who together own and control more than 7,000 ATMs in California alone — began charging an extra fee of $1.50 to non-customers beyond what they were previously getting from the ATM networks.

Now, non-customers who use these ATMs can expect to pay as much as $3.50 or more per ATM transaction. Coast Federal Bank and the other members of the “No Surcharge ATM Alliance” do not impose this surcharge.

The Alliance has adopted a logo for its member institutions. During the next month, Coast and its Alliance partners will place it on their ATMs to alert the public of the machine’s surcharge-free status.

Coast is joined in the “No Surcharge ATM Alliance” by Union Bank of California, Sanwa Bank California, Glendale Federal Bank, Sumitomo Bank of California, Bay View Federal Bank, and the CU Cooperative System, which provides ATM network services to more than 300 credit unions. Although mainly in California, participating Alliance ATMs can be found in Utah, Arizona, Oregon, Washington and 11 other states.

While the new ATM surcharges may be unavoidable, the public does have the ability to avoid paying STAR and PLUS System fees — and keep their ATM fees to a minimum — through a number of Coast accounts.

For example, Coast’s Free Checking account gives customers 10 free STAR or PLUS System ATM transactions per month, if they maintain a balance of $2,500. Direct Deposit Plus Checking allows the same number of transactions regardless of balance. Seniors Only Checking provides unlimited STAR or PLUS System transactions at no charge.

Finally, Gold Coast Checking — an interest-bearing account — gives customers 10 free STAR or PLUS System transactions per month on a balance between $2,500 and $9,999 and an unlimited number if the balance is $10,000 or more.

Coast Federal Bank, FSB, is a subsidiary of Coast Savings Financial Inc. With assets of $8.7 billion, Coast is one of the nation’s largest savings institutions, providing consumer banking services and residential mortgage lending services through 92 branches in California.

Glendale Federal Bank Joins No-Surcharge ATM Alliance

To counter the “fee gouging” by the state’s major banks of non-customers who use their proprietary ATMs, Glendale Federal Bank today announced it will join an alliance of California financial institutions creating a statewide network of ATM machines that do not impose surcharge fees. In doing so, the bank agrees to not surcharge non- customers who use its 175 ATMs that are attached to or located next to its retail branches.

“Unlike our major competitors, we are not going to strong-arm or extort the market or gouge customers for additional income,” said William J. Birch, Glendale Federal’s executive vice president and manager of Retail Banking. “We want our customers and non-customers to know that there are better and less expensive ways to get money from their accounts.”

Birch said the alliance will create a statewide network of nearly 2,200 ATMs. “This is a boon for the millions of consumers with accounts at the banks participating in this venture,” he noted. Moreover, he explained that it will create a level of convenience comparable to that provided by the state’s largest banks, Bank of America and Wells Fargo Bank. These two banks surcharge non-customers $1.50 per transaction.

Seven financial institutions, including Glendale Federal, Bay View Federal Bank, Coast Federal Bank, CU Cooperative Systems, Inc., Sanwa Bank of California, Sumitomo Bank of California and Union Bank of California, have joined to form the initial alliance. These institutions will bring together a network of 2,189 ATMs, with 2,037 in California and 152 in 12 other states. Each participating ATM will carry a common logo bearing a “no-surcharge” symbol. Additional financial institutions are expected to join the marketing alliance within the next few months, thereby increasing the number of available non-surcharge ATMs.

Glendale Federal Bank is California’s leading community bank serving the business and consumer banking needs of Californians through 154 banking offices and 25 loan offices. Customers can reach the bank by calling 1-800-41FEDUP, or get information through its Internet site at http://glenfed.com.

Sanwa Bank Reaffirms Decision To Allow Non-Customers Access To ATMs Without Extra Fee, Joins Rivals In Alliance

Unlike some of its larger competitors in the state, Sanwa Bank California today strongly reaffirmed that it will not levy a surcharge on non-customers who use its branch Automatic Teller Machines (ATMs) to withdraw cash or conduct other banking business.

In reaffirming its policy on ATM usage by non-customers, Sanwa also took the unusual step of joining with some of its rivals within the state to form a group that together will offer consumers more than 1,500 ATMs that will not impose the extra fee on non-customers. Other companies include Glendale Federal Bank, Union Bank of California, Coast Federal Bank, Bay View Federal Bank and CU Cooperative Systems Inc., which operates credit union ATMs.

Last November, before this group was formed, Sanwa publicly decried the move by Bank of America to levy an extra $1.50 fee when non-customers use their ATM networks, terming it anti-competitive and anti-consumer.

“We now have a way to counter this bold attempt by Bank of America, Wells Fargo and Home Savings to penalize consumers whose banks are members of the STAR, Cirrus or Plus ATM networks but happen not to be their customers,” said Doug Stewart, first executive vice president of Sanwa’s Marketing & Delivery Support Group. “With their dominance of the ATM system in the West, it was almost impossible for other California banks’ customers not to be forced to use one of their ATMs from time to time. It is unfair to charge those non- customers an extra fee.”

To combat the move, Sanwa officials, who months ago began a campaign inviting non-customers to use any of its ATMs without worrying about a surcharge, will help develop and then use a common logo (attached) with other banks in the alliance that will clearly identify its non-surcharge ATMs throughout the state.

“We believe that the only way to distinguish ourselves from this anti- competitive tactic is to offer the same ATM service without the surcharge,” said Stewart. “We want our own customers — and non-customers who may use our ATMs — to know that we value their business and will not `tax’ them to use our machines.”

Sanwa Bank California, with nearly $8 billion in assets, ranks as the fourth-largest bank in the state. It provides a full-range of services — including ATM banking — at its network of more than 125 offices, branches and commercial banking centers statewide.

Union Bank Of California Joins No-Surcharge ATM Alliance

Union Bank of California announced that it is joining an alliance of financial institutions in creating a cooperative of ATMs with no surcharges.

Additional financial institutions are expected to join the alliance within the next month, further extending the available options.

“This new alliance enables us to direct our clients to ATMs where they will not be subject to any ATM charges,” explained Richard C. Hartnack, UBOC’s vice chairman and head of Community Banking. “We believe there is public support for such a consumer-friendly approach, which becomes more valuable every time the alliance adds new members.”

Members of the new alliance are Bay View Federal Bank, Coast Federal Bank, Glendale Federal Bank, Sanwa Bank California, Sumitomo Bank of California and Union Bank of California. In addition, the CU Cooperative Systems Inc. (THE CO-OP), is an alliance member. The CO-OP provides ATM network services for more than 1,300 ATMs and more than 300 credit unions, primarily in the western U.S. In total, the “No-Surcharge ATM Alliance” includes more than 2,100 ATMs, most of which are in California. There are also 68 alliance ATMs in Utah, 34 in Arizona and additional machines in 13 other states, including Oregon and Washington.

Initially, there will be 791 no-surcharge ATMs in the Los Angeles/Orange County area, 348 in the San Francisco Bay area, 328 in the San Diego metropolitan area, and 570 in other California locations, including the Central Valley.

The driving philosophy behind this effort is that the long-term strategic interests of depository institutions will be served best by encouraging use of such facilities as automated teller machines. Hartnack called the proposal “an effort to make basic services convenient, widely available and affordable. We feel that this reasonable accommodation to consumer interests will ultimately benefit the financial institutions choosing to participate in the ATM alliance. We encourage even more institutions to join us, because the alliance will enable consumers to remain with their community-based financial institution, but to have a broad choice of ATM locations.”

Alliance member institutions have adopted a common logo-which will be displayed on the participating no-surcharge ATM machines over the next month.

The San Francisco-based UnionBanCal Corp. (NNM:UNBC) is the holding company for Union Bank of California, the third-largest commercial bank in California, with more than $29.2 billion in assets. The bank has more than 240 branches in California, five in Oregon and Washington, and 17 overseas offices, located primarily along the Pacific Rim.

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