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How to choose the bank that's best for you

300 dpi 4 col x 12 in / 196x305 mm / 667x1037 pixels Cinthia Romero color illustration of two boats, Credit Union and Bank, with their customer service "bait" offered to the fish below. The Dallas Morning News 2004

With BC-PFP-BANKUNION-BIZPLUS:DA, The Dallas Morning News by Ieva Augstums



KEYWORDS: krtbusiness business krtnational national krtnamer north america krtusbusiness u.s. us united states krt banco bank bankunion barco boat coddington romero credit union credito da contributed fish fishing grabado illustration ilustracion negocios pescador pez ship 2004 krt2004
300 dpi 4 col x 12 in / 196x305 mm / 667x1037 pixels Cinthia Romero color illustration of two boats, Credit Union and Bank, with their customer service "bait" offered to the fish below. The Dallas Morning News 2004 With BC-PFP-BANKUNION-BIZPLUS:DA, The Dallas Morning News by Ieva Augstums KEYWORDS: krtbusiness business krtnational national krtnamer north america krtusbusiness u.s. us united states krt banco bank bankunion barco boat coddington romero credit union credito da contributed fish fishing grabado illustration ilustracion negocios pescador pez ship 2004 krt2004 KRT

Big banks are at it again, ticking off customers with nagging fees. And the Occupy Wall Street movement has renewed sour feelings toward big financial institutions that were deemed too big to fail during the financial crisis and received bailout loans from taxpayers.

Small banks, online banks and credit unions are putting up their dukes and taking a few swings at megabanks while they're suffering from the bad publicity.

So, big or small? Who wins on the merits in a toe-to-toe fight between megabanks and smaller institutions? Who should consumers put their money on — or money in? Is bigger better, or is this a Rocky Balboa story?

For help, we talked to Greg McBride, senior financial analyst at Bankrate.com; Tony Giorgianni, associate money editor at Consumer Reports; Mike Schenk, vice president of economics and statistics at Credit Union National Association; and Richard Barrington, personal finance analyst for MoneyRates.com.

We judged winners for each round. See if you agree.

Round 1: Fees: Granted, big banks generally offer ways to dodge common fees, such as maintaining a minimum balance in an account or having your paycheck directly deposited into an account.

But, overall, you're far less likely to pay monthly fees at smaller banks, online banks and credit unions, experts say. Financial information site Bankrate.com found that about three-quarters of large credit unions offered free checking accounts, with no strings attached. Just 45 percent of banks did, McBride said.

Winner: Smaller institutions.

Round 2: ATM access: This is where big banks traditionally have had a big advantage. But smaller competitors today are able to join ATM networks that allow customers to use a variety of teller machines without charge.

And some, notably online banks that usually have no ATMs of their own, reimburse customers for fees incurred at any bank machine. But these reimbursements are often capped at a certain dollar amount, maybe $12 a month. So it's not a good choice for frequent visitors to ATMs.

Overall, however, most people will find that large banks still have an advantage here, with ATMs not only at their many branches but also in a variety of retail stores.

Winner: Big banks.

Round 3: Branch networks: This round will look much like the last. For some consumers, it might put small banks on the ropes. Small banks might have a plethora of branches in a limited area, but it's no match for a big branch network nationwide.

Some credit unions have sharing agreements, where customers of one credit union can walk into the branches of other credit unions and use their services.

Of course, most online banks have no branches at all. If you need face-to-face service in a variety of geographies, big banks take the round for most consumers.

Winner: Big banks.

Round 4: Customer service: Big banks can boast round-the-clock customer service centers, reachable by phone and online chat. But if you define service as a financial institution being more personable and accommodating to individuals, credit unions are especially known for that.

Small banks are known for down-home service. This is a huge comeback round for the little guys.

Winner: Smaller institutions.

Round 5: Ownership: Big banks are obligated to make as much money as they can for shareholders, which often is on the backs of customers. Non-profit credit unions, specifically, win this round because they are beholden only to their customers, because customers are the owners.

Winner: Smaller institutions.

Round 6: Financial products: Credit unions, in particular, once had sparse offerings for savings, checking, borrowing and online banking. Nowadays, it's a closer call, as smaller institutions of all flavors expand their lines of financial products. Still, a large bank is likely to offer more account and loan options.

Winner: Big banks.

Round 7: Technology: Small banks and credit unions probably offer online account access and perhaps electronic bill paying. And, of course, online banks are likely to have decent technology options. But having advanced offerings, such as mobile banking and person-to-person payments, are largely the domain of large banks, McBride said.

Winner: Big banks.

Round 8: Rates: Credit unions, small banks and, especially, online banks typically pay higher rates on savings and offer lower-rate loans.

Winner: Smaller institutions.

So, that's four rounds to each side. No single type of financial institution is right for everybody.

Although it might add complexity, you can get the best of both: checking at a big bank and loan and savings at a smaller one, for example, Giorgianni said.

"There's really no single answer," he said. "You have to do your homework."

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