This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

5 Reasons to Stay With the Big Banks

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK ( TheStreet) -- If the Occupy Wall Street protesters have done nothing else, they've inspired millions of Americans to think long and hard about moving their money into local banks and credit unions. After all, it was big, multinational banks that crashed the world economy, tanked the housing market, and made life miserable for the rest of us, right?

Occupy Wall Street: News Feed >>
The latest news, photos and videos from the 'Occupy Wall Street' protests.

Now, news reports have it that those same big banks are setting aside hundreds of millions of dollars to reward their employees with hefty year-end bonuses. Shouldn't they be punished somehow? What better way than by being abandoned by their customers?

Unfortunately, the situation isn't that simple. Bank customers who protest the behavior of publicly traded, multinational banks by moving their money may feel good about putting their feelings on record. Local banks and credit unions have, by and large, done better than many of their larger, more corporate cousins, and can offer a level of warm, personal service the big banks often don't. But before you start closing your accounts and moving your money, here are five good reasons to stay with your big, bad bank:

Consumer banks aren't at fault. Global, full-service banks are not usually single entities. They're typically massive conglomerates of investment banks, consumer banks, and holding companies. It was the investment banks, and not their consumer bank affiliates, that started playing Russian roulette with subprime mortgages and credit default swaps. Yes, be outraged with JP Morgan Chase (JPM - Get Report), Goldman Sachs (GS) or Citibank (C - Get Report) if you will, but recognize that their consumer banking divisions had little or nothing to do with the financial brinksmanship that tanked the world economy or the personal greed that continues to offend average Americans and lawmakers.

Bank service is largely local. While your neighborhood bank or credit union may seem charmingly personal compared to its global competitor, there's frequently little difference in how their local branches operate. A well-run branch of a multi-national bank can be every bit as welcoming and helpful as its competing neighbors. Not only that, you can comfort yourself that the local branch manager, tellers and desk clerks probably aren't enjoying any of those massive bonuses and other perks that investment banks continue to provide to their top producers.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BAC $14.56 0.00%
C $46.28 0.00%
JPM $63.20 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs