Consumer Group Cheers Collapse of TD Bank, First Horizon Merger

TD Bank chided by advocates for excessive overdraft fees

The Center for Responsible Lending (CRL), consumer advocacy group focused on finance and banking issues, is cheering the collapse of a proposed merger between TD Bank and First Horizon as the two banks announced today they are terminating their agreement.

CRL had previously called on the Federal Reserve to deny the merger over concerns about TD Bank's overdraft policies. The group says TD Bank has a track record of charging excessive fees that disproportionately harm low-income consumers.

CRL says the breakdown of the merger is a direct result of increased regulatory scrutiny and is a welcome sign for banking consumers.

“The OCC and Federal Reserve demonstrated they would not rubber stamp this merger bid without considering the public interest,” said CRL President Mike Calhoun. “Regulators deserve credit for not granting an expansion of TD Bank’s problematic operations, which includes an overdraft program that hammers financially vulnerable consumers with costly fees. This announcement presents an opportunity for TD to turn over a new leaf and treat its customers more fairly.”

TD Bank can charge over $100 a day in overdraft fees on its U.S. customers, but in Canada, the bank charges customers no more than five Canadian dollars (around $3.70) a day.

Calhoun added, “Regulators should take additional steps to protect consumers from exorbitant overdraft fees. Recent experience shows banks won’t police themselves.”

The current termination of merger talks between TD Bank and First Horizon does not foreclose a future deal between the two banks.

Photo byFerran Fusalba RosellóonUnsplash