TAKING STOCK: Fifth Third Bank

Dear Mr. Berko:

I live in your area and have been banking with Fifth Third for years. They send me volumes of junk mail every month hoping to sell me their various services. I used to just throw this junk mail away but twice I accidentally tossed my credit card bills, and the bank bombed me with $60 in late fees. I'm sure they do this on purpose to generate more revenues for their bottom line. A neighbor has the same problem. We've asked them to stop, but the branch manager says they can't. The bank takes 16 days to clear out-of-town checks, and that's very inconvenient. They charged me $25 to make copies of my checks, and then charged me $30 for copies of three monthly statements (from 2010) and other small, sneaky fees. Finally, it's impossible to directly call my branch because their phones are answered by a call center in Ohio. Would you recommend Bank of America, or Chase or Wells Fargo as a good place to bank? And with the way this bank rakes in fees, a neighbor thinks Fifth Third stock would be good to buy.

CF, St. Largo, Fla.

Dear CF:

My Dad used to say, "The reason so many members of Congress and so many bankers are alive today is because it's illegal to shoot them." If you are depositing a check from the Bank of Iran, the Bank of Nigerian or the Bank of North Korea, I can understand "11 business days to clear." But you deposit a check from Monkey's Eyebrow, Ky. or Cuba, Kan. any morning of any day (except Saturday or Sunday), and it clears electronically at 2:00 PM that same day. If your bankster tells you differently, he/she is bloody dissembler.

Don't tarry, don't delay and don't pass "Go." Change banks immediately or faster if you're able. And I won't recommend Bank Chase, Wells Fargo or Bank of America, because these "too big to fail" banks have a high "Public Disgust Factor." Many banks now have a higher PDF than members of Congress and pedophiles. And, usually, the bigger the bank, the higher its PDF.

There are some well-managed, consumer-friendly credit unions in your area as well as several small and trustable non-public banks that provide full disclosure, conduct business with integrity and won't nickel or dime you with fees. They call you by name, greet you like a good neighbor and warmly welcome you as "their customer."

Fifth Third (FITB-$16.36) probably taught the airlines how to charge its customers. FITB has more fees, charges and wharfages than you can "stick a shake at." And your neighbor seems to be wearing a good thinking cap because those fees enable FITB to have one of the highest Return On Assets (ROA) of most publically held banks. FITB's ROA of 1.20 percent is nearly twice that of Bank of America, Comerica, Citi Group, J P MorganChase, Bank of New York, PNC, Regions and SunTrust.

Only Wells Fargo has a better ROA (1.40 percent) for two reasons: (1) Their fee schedules are higher and more expansive and (2) Wells Fargo has fewer employees per account than most other banks so their Customer Service really sucks. However, because so many Americans are financial stupids, FITB, Wells Fargo, Bank of America, JP Morgan Chase just fleece 'em like sheep so their bottom lines shine.

The Street believes FITB's 2013 asset base will increase 2.5 percent to $12.3 billion, and that total loan volume will improve by 4 percent to $85.5 billion, a record high. But even though Loan Loss Provisions should decline in 2013, Net Interest Income and Non-Interest Income will fall and cause 2013 earnings to decline from $1.63 to $1.55 this year.

In the coming few years, FITB should demonstrate modest growth in deposits and earnings and the 36-cent dividend could be raised to 40-cents despite lower earnings. The shares are basically an average selection, but as loan volume grows in a modestly improving economy, the shares could trade in the low $20s within a few years.

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Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775 or e-mail him at mjberko@yahoo.com. Visit Creators Syndicate website at www.creators.com.

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Published: Fri, Apr 5, 2013