Cutting From the Chase

Last week we closed our bank accounts at one bank because we had opened an account at another. Perhaps a sign of the times, we went from the nation’s largest bank and second largest and seventh largest in the world based on revenues and assets, respectively, to a virtual bank – no brick and mortar – at one of our investment companies. Ordinarily this wouldn’t be anything to write about but like many things in life, so please bear with me.

 My father left his CPA firm in 1963 to join his friend and fraternity brother Les Weil at American Envelope Company, serving as chief financial officer and treasurer. The company had its banking relationship with Lake Shore National Bank, which had its offices at the corner of N. Michigan Avenue and E. Ohio Street. During my stint at the company during the summer of 1968, I watched him balance a half-million-dollar bank statement in his head – he had a photographic memory – and know the reason for the few dollars’ discrepancy. 

American Envelope Company playing cards. It would have had to changed its logo.

With my first summer job in 1966, I opened a passbook account at Lake Shore National. In those days before direct deposit, ATMs and Internet/smartphone banking, my father deposited my paychecks (and any others I might receive) during his frequent trips to the bank. One year later, I opened my first checking account at Lake Shore before heading off to college. Dad would deposit my “allowance” each month in that account, letting me know so I could enter it into my ledger. I would do the same for our daughter when she entered college in 1997. 

Lake Shore National Bank passbook

I’m slightly exaggerating that this relationship lasted continually 55 years. Shortly after my father died suddenly in 1973, I received a three-month-old deposit receipt in the mail with no note or explanation. Bringing it to the bank, I was informed my rather large deposit went into my father’s estate account and thus had earned no interest (back in the days when passbooks earned decent interest) during that period. When I asked him to credit the lost interest, he replied, “Tell me how much you want. I’ll take it out of your father’s account.” Knowing that was wrong, I said, “You don’t know who you’re dealing with” and went straight upstairs to the executive who handled the American Envelope account to point out this error. The bank gave me the interest.

 A few years later, we opened accounts at First Chicago’s banking subsidiary, the venerable First National Bank of Chicago, and stopped using our Lake Shore accounts. First Chicago acquired Lake Shore National in 1994, so we still would have ended up at The First. One year later, First Chicago merged with NBD (holding company for the National Bank of Detroit) to form First Chicago NBD. That company in turn was bought by Columbus, Ohio-based Banc One Corporation in 1998; the merged company was renamed Bank One Corporation and moved its headquarters to Chicago. Finally, Bank One was acquired by JP Morgan Chase in 2004; its bank’s origins date back to 1799 and include Bank of the Manhattan, Chase Manhattan, Manufacturers Hanover and Chemical Bank. 

First National Bank of Chicago cover. We kept our checks in it for decades.

After the 2008 financial crisis caused banks and brokerage houses to lower their minimums, we enrolled in Chase Private Client, which combines bank accounts with JP Morgan investment management. The program was excellent. Our investment accounts consistently outperformed the market, and our banker handled important financial issues for my mother immediately before and after her death in 2013. Our investment advisor announced he was leaving JP Morgan in December 2019, and we elected to move our accounts with him. Before long, we not unexpectedly were informed we would no longer be part of Private Client unless we met a specific requirement.

 The letter from Chase stipulated we were required to maintain a six-figure balance in JP Morgan by the end of 2000 or be subject to a $35.00/month charge for a checking account. That was it. Right away, we moved to open a checking account at Charles Schwab Bank, where we also have investment accounts. This involved changing pension and Social Security deposits information as well as the bank from which bills would be paid. The former needs at least two months to be effective. We planned to close the accounts after Janet’s Medicare premium was paid (she doesn’t receive Social Security so it has to be paid directly) this month. Just as that payment was received (after putting off our Chase banker until these transactions were transferred), we received a letter stating our accounts would be changed to a different type of accounts but keep the account numbers – no need to change deposit and payment data – and fee-free (otherwise $12/month) if we had very minimal automatic monthly deposits. Suffice to say, if we’d known that in the fall, we would have kept our accounts there.

 The banker was very gracious in closing our accounts, admitting the bank handled the communications poorly, intimating it had initially thought this would be an opportunity to bring significant funds into the company. My guess is later management saw it wasn’t happening and opted to try to retain low-balance customers.

 Now this may seem like just a screed about a large corporation neglecting its long-time customers. But it was more than that. I felt somewhat sad for a short time thereafter but never doubted my decision. Then I realized it was because of what it represented in life events: my first paychecks, first checking account, adding Janet’s name to our now joint accounts, opening accounts for Marisa and the challenges facing my mother’s imminent passing. Oh, and watching my father balance that half-million bank statement in his head.

My father at his 50th birthday party. The cake was made to look like a ledger.