Bank of Israel in Renewed Drive to Lower Bank Fees

Banks supervisor tells institutions to review accounts of elderly, handicapped for excessive charges.

Daniel Bar-On

The Bank of Israel is taking another series of steps to lower bank fees, including the requiring of institutions to review accounts held by elderly and the handicapped to make sure they are paying the lowest fees appropriate to their needs.

Banks Supervisor Hedva Ber said in a report that efforts to inform older and handicapped accounts holders of lower-cost fee structure had failed and that she now expected the banks to take the initiative by reviewing accounts and informing holders that they would be changed.

The report said the drive to reduce bank fees had delivered notable successes, with basic fees falling to an average of 13.50 shekels ($3.39) a month in the first eight months of last year from 16.40 in 2010.

“Many exceptionally high charges have been taken care of in recent years by the banks supervisor by imposing price controls or by canceling them,” Ber said in the report. “Nevertheless, we believe that the remaining exceptionally high fees must be taken care of, too, along with an increase in the number of clients who use plans that reduce banking service costs and to regulate securities trading fees.”

Ber said the bank would be surveying excessive fees for household and small-business accounts and imposing directives as the need arises. It urged the banks to do the same to head off being ordered to cut charges.