Look for Bank Fees to Rise as Number of Banks Falls

Two European banks were reported late last week to be interested in shedding significant pieces of their American business. ING, based in the Netherlands, said it was taking steps to sell its U.S. online bank, and the Wall Street Journal quoted sources indicating that Anglo Irish Bank (which is more Irish than Anglo) planned to divest its $10 billion portfolio of U.S. commercial loans.

Then on Monday Stuart Gulliver, chief executive of HSBC (HBC), said the giant bank would ease out of its American credit card business if a buyer could not be found. (The announcement was made in Jakarta, where Gulliver was traveling.)

These small news items, sideshows to the European debt crises - either the first one in 2008 or the one flaring up now as enfeebled governments in the region struggle to meet their obligations - may provoke a "so what." There's an element of "uh-oh" about them, too, however - as in "uh-oh, the fees that my homegrown bank charges for things that used to be free may be on the verge of going up even more."

A study by Bankrate.com grimly spells out the extent to which banks have raised a variety of fees already. Free checking for non-interest-bearing accounts has all but vanished, the study notes. As for interest-bearing accounts, well, the interest on them has all but vanished.

The same goes for free automated teller machines outside of your bank's branch network. Bankrate's research found that 99 percent of banks charge a fee on transactions for which a customer and an ATM are from different banks.

The average fee charged by banks to non-customers rose 5 percent in 2010, the study says, while the average fee that banks charge their own customers to use another bank's ATM rose 7 percent. If you and your ATM card stray, there's a good chance that you'll end up paying $4.

Fees for other services, such as overdrafts, most notably and infuriatingly, are also on the rise. Bankrate attributes the rising costs in large part to more stringent and extensive government regulation after the 2008 crisis, but there is more to it than that.

Banks lost a fortune during the crisis, so they've got to get the money back somehow, even if it's a couple of bucks at a time. Then there's the consolidation in the industry, as some banks just plain blew up and others were taken over by stronger rivals, such as Chase's (JPM) absorption of Washington Mutual.

This is where the European debt crisis and the departure plans of ING (ING) and Anglo Irish come in. Their moves would confirm that the trend toward fewer institutions offering financial services remains in full force. It's possible that new players will enter the marketplace, but the two names mentioned most as buyers of ING's assets are very American - Capital One (COF) and General Electric (GE) - so don't bet on it.

As the same handful of banks increase their dominance of the industry and competition continues to erode, fees are likely to keep rising. Fortunately, a fair number of smaller, cheaper banks still want your business. While you've got the Bankrate site on your screen, have a look at some of them and get ready to move your money, sooner rather than later if you're an ING customer.