Reduction in the Debit Fee Revenue Took Its Maximum Toll on BB&T Corporation
The enactment of the Durbin Amendment made the BB&T to lose about $ 145.2 million in the form of revenue in the fourth quarter. According to the SNL Financial the North Carolina based company lost the amount as some debit fee revenue, which made it a decrease of 70 % down the line. The loss incurred by the BB&T Corporation was one of the largest among all the companies which are related to the Durbin Amendment. This was supported by the report provided by the Winston-Salem Journal
BB&T officials have however blamed the SNL Financial to have been an inaccurate report. The bank from North Carolina reported that the revenue loss incurred would be around 46 % instead of the 70 % furnished buy the SNL Financial group. This record would make the bank the 2nd most affected corporate association with respect to the loss in revenue. However the SNL Financial found it good to not make a comment when asked about the data report related to Winston-Salem Journal.
It was in the month of October when the Durbin Amendment took its effect. The Amendment restricted the capital or amount that the bank can charge to the user to process any kind of debit transaction. This would lead to a general reduction in the revenue assets & profits made by the banking authorities or any other financial institution. A Professor of the Finance department of the University of North Carolina located in Charlotte named Tony Plath commented that the large down fall in the revenue generation at the BB&T is not at all surprising. This was also the same in case of Wells Fargo.
According to Tony Plath “the books entitled for deposit in both the BB&T as well as Wells Fargo are predominantly maintained in a retail format unlike the commercial corporate banks or institutions such as the Bank of America or the Citifinance group.” The Winston-Salem journal reported that the “the funding resources are mostly based on consumer accounts which is based specifically on debit card usage made by the consumers. This fact makes the Durbin Amendments to have largely affected the firm.”