E*Trade to introduce new fees and charges
Online broker E*Trade has revealed plans to introduce new fees and charges on cash withdrawals and inactive accounts in a bid to boost revenue and reduce costs. From January 15, cash withdrawals from accounts that require E*Trade staff to carry out transactions manually will incur a $5 fee for subscribers. A flat $50 fee will also be charged for all off-market transfers from Monday. Starting in March, clients who let the value of their accounts (inclusive of cash and shares) fall under $10,000 could be charged a quarterly $16.50 maintenance fee. This maintenance fee will be waived for clients with accounts worth less than $10,000 so long as a minimum of two share transactions are executed every 6 months. Margin loan accounts will not be charged a maintenance fee.
The pricing restructure comes after E*Trade announced last week that it would incur a 2001 operating loss higher than last year's loss of $11.7 million. Mr Bill Wileman, E*Trade's head of marketing, said that they did not expect to lose a substantial amount of customers due to the new fees.
‘E*Trade raises fees in bid to lift revenue', The Australian Financial Review, 12/01/01, p 35.