In an announcement today, KeyCorp bank released their estimate of the impact the final debit interchange fee rules on their revenue streams. Essentially, they halved the $100 million dollar estimate they released back in December 2010, when the draft rules which proposed to drop debit interchange to $0.12 per transaction were released.
“In a filing with the Securities and Exchange Commission Tuesday, KeyCorp said, “If interchange fees are set at the maximum amount allowed by the Regulation and we receive the fraud adjustment amount, we estimate that the impact on our debit interchange revenue stream will be an annualized decline of approximately $50 million to $60 million before any potential offsets from other fees or charges that may be implemented.”
As we’re seeing with other banks with more than $10 billion in assets, DDA accountholders can expect to see new fees and charges applied to their Key Bank accounts based on this comment. In addition, no bank can estimate the final impact since the Federal Reserve has not set a fixed fee, but a cap –which means that the final blended rate issuers can expect to earn on their debit card transactions won’t be known for a least a few months after the October 2011 implementation date of the interchange rules.
Read the entire article here: http://online.wsj.com/article/BT-CO-20110705-711216.html