BANKS have been hiking fees – a move that could help cushion the expected compression in their interest income – as analysts expect fee income contribution to rise for local banks.
At least one pundit, however, points out that the hikes might not generate higher fee income if consumers seek alternatives.
OCBC Bank is raising fees this December for at least three segments: credit card cash advance fee, credit card foreign currency transaction administrative fee as well as annual fee and late fee for personal standby credit line.
OCBC, however, was not the first among the local trio to fire the salvo. Its latest move to raise administrative fees for credit card foreign currency transactions followed Overseas United Bank’s (UOB) September hike and DBS Group’s November increase.
DBS and UOB spokesmen told The Business Times that they periodically review and adjust their fees to ensure that they are competitive and in line with the market. OCBC said its fees are reviewed “in accordance to adjustments within the industry”.
DBS and UOB saw their loan-related and credit card fee and commission income edge up in the third quarter to September as well as the first nine months.
DBS reported a 6 per cent increase year-on-year for its third-quarter loan-related income to S$117 million and an 8 per cent improvement for its the nine-month figure at S$323 million.