4/29/2013 11:45 PM ET|
Best and worst states for banking
The US banking industry is getting better, but the improvements aren't being felt evenly. See how your state compares.
These days, the banking world is full of news, good and bad. But that news is better in some states than in others.
Nationally, the good news is that the banking system is more stable now than it has been in recent years. According to the Federal Deposit Insurance Corp., 51 banks failed in 2012. That's less than 1% of all FDIC-insured institutions, and those 51 failures represent a significant improvement from 92 failures in 2011 and 157 in 2010.
The bad news is that savings account rates remain low, and cost-cutting has caused customer service to suffer at some banks. But how acutely you feel these problems may depend on where you live.
Mapping the banking landscape
For better or worse, banking conditions are largely a function of where you look. For example, 33 states had no banks fail in 2012, while Georgia had 10 -- nearly one-fifth of the national total.
To see how banking conditions stack up from state to state, MoneyRates.com has rated the 10 best and 10 worst states for banking based on the following factors:
- Customer satisfaction. This is based on Toluna survey data exclusive to MoneyRates.com.
- Stability. MoneyRates compared the number of 2012 bank failures in each state with the total banks based in that state.
- Availability of high interest rates. Bonus points were awarded to states that are home to branches of top-finishing institutions in the MoneyRates.com America's Best Rates survey.
- Size of the banking community. Though this was used only as a tie-breaker, the premise is that a larger banking community means more choices for consumers.
The 10 best states for banking
Based on the criteria above, here are the 10 best states for banking:
- Ohio. Ohio residents gave their banks the fifth-highest average score for customer satisfaction. In addition, no Ohio-based banks failed in 2012, so Ohio also scored well for stability. As a bonus, Nationwide Bank, which made the top 10 for money-market rates in the most recent America's Best Rates survey, is based in the state.
- Kentucky. Kentucky's average satisfaction score ranked just behind Ohio's, and it also had no bank failures in 2012.
- Louisiana. Louisiana finished with the same overall score as Kentucky; the tie-breaker in their rankings was the number of banks based in the state.
- Montana. Montana scored very high on customer satisfaction, and it also experienced no bank failures. But with relatively few banks based in the state, the latter did not weigh as heavily in the final score.
- West Virginia. A very similar story to Montana, with high customer satisfaction and no bank failures, albeit with a relatively small banking community.
- New York. Banks in New York received an above-average score in satisfaction, and the state saw no bank failures in 2012 out of the 175 institutions based there. New York is also home to more than 250 offices of Capital One Bank, which made the top 10 for savings-account rates in the latest America's Best Rates survey.
- Virginia. In addition to scoring well for customer satisfaction and having no failures in 2012, Virginia is also home to two of the top banks in the America's Best Rates Survey: Capital One and Acacia Federal Savings Bank.
- North Dakota. North Dakota finished in a virtual tie with Virginia, with Virginia winning the tie-breaker due to its larger banking community.
- Colorado. In addition to having no bank failures in 2012 and earning an above-average score for customer satisfaction, Colorado is home to Mile High Banks, a regular on the America's Best Rates top-10 lists.
- Texas. Texas scored slightly below-average on the satisfaction survey, but gets top marks for stability because it had no failures in 2012, despite being home to more than 500 banks. Texas residents also benefit from having access to branches of Capital One, whose rates often place it in the America's Best Rates top 10.
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I spent 21 years in the banking business. When I left the bank I started a new career and joined a Credit Union. I wish that I had know about Credit Unions before Banking was my vocation. Great industry and far more compeitive and customer oriented than Banks.
I did not know there were good or bad states for banking.
I thought all banks were a-holes regardless of where they are.
We have an on-line bank where we get .9% on our balance. We have a local Michigan bank (soon to be an Ohio bank) where we get .1% on our balance. And then we have an account at the Charles Schwab & Co. bank where we get a disgustedly miserly .01% on our balance. Shame on you Schwab Bank!
Ker-plunk, I have no problems with my bank either.
Doesn't change the fact that they are a-holes.
ALL banks in ALL states SUCK! First, they screw us with mortgage meltdowns and foreclosures, give us nothing for our money, charge a fee for just about everything and continue to run this country into the ground. Rather than our brilliant president give every working person over the age of 18 $300,000 each (same equivalent as the bank bail outs) he bailed out all these banks - and the weaker ones no longer exist. Soon, these huge monopolies will all burn in hell as the economy continues to teeter on "phantom money and its all just a matter of time before they take you with them. Instead...
Instead stick with a good old fashion credit union. They usually have free coffee, the lines are short, little if any fees, low interest rates on home/car loans and they always remember my name, not my account number. Just my two cents...
Clearly this list of good/bad banks has nothing to do with customer service complaints - or Missouri would be ranked the WORST. I gave my daughter $20,000 to help with a store she was opening and she took it to her bank and put it in a savings account, then asked that it be transferred to a CD, to be used down the road when she was ready for it. The customer service specialist told her they'd "take care of it". When she went back to the bank a few months later, she was told that they'd "forgotten". Oh well. Darn it. Nothing to be done.
My bank (and the bank my employer uses) is the absolute WORST for customer service. People put up with way too much from their bank - we would all get more if we DEMANDED more - and backed up our demands by taking our dollars to banks that treat us like humans.
Nearly useless article. Each branch is different and will offer services with varying degrees of competence. Some banks are more conducive to customers - open on Sundays, longer regular hours and perks for certain customers.
Honestly, I try very hard to never go inside a branch. Almost ALL transactions can occur online or via an ATM.
Agree with most posts that Credit Unions are more apt to have better rates than standard brick and mortar banks. I hate to say it, but banks will treat good customers better than bad ones. If you constantly bouncing checks, etc, you will be hammered with fees.
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