Banks eye higher fees to boost declining revenue

NEW YORK - Big banks facing big drops in revenue are looking to Main Street to make up the difference.

Checking accounts, bank statements, even popping into your local bank branch could carry a hefty cost as the nation's mega-banks scramble to offset expected damage from the sweeping financial overhaul. The uncertain future has overshadowed otherwise strong second-quarter earnings at JPMorgan Chase & Co., Citigroup Inc. and Bank of America Corp.

All three companies beat expectations this week with profitable results. Yet their stocks tumbled, helping send the wider market sharply lower Friday.

The reason: Investors are worried about banks' future earning power after Thursday's passage of the most dramatic rewriting of banking rules since the Great Depression. Adding to the pessimism are falling trading profits - which all three banks mentioned in the their earnings reports - and weak U.S. loan demand.

The worries are well-founded. Bank of America said Friday it could lose up to $2.3 billion in annual revenue alone just from new restrictions on debt card "swipe" fees, or the money banks charge merchants who accept debit cards. All told, the bill's passage will reduce the value of Bank of America's lucrative credit card business by a staggering $7 billion to $10 billion.

Wells Fargo & Co., Goldman Sachs Group Inc. and Morgan Stanley report earnings this week and are expected to see the same trend of declining loan losses but weaker revenue from trading and from financing stock and bond offerings.