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Bank of America pledges halt on card rate hikes
2009-10-06
WASHINGTON (Reuters) - Bank of America (BAC.N) said it will not raise rates or change terms on consumer credit card accounts ahead of reform legislation slated to go into effect early next year, according to a letter released by a lawmaker on Tuesday. Christopher Dodd, chairman of the Senate Banking Committee, released the letter, dated October 5, and called on other companies to follow Bank of America's lead. "In light of the concerns expressed to us by our customers, Bank of America will not implement any change in terms (risk or economic based) re-pricing of consumer credit card accounts between now and the effective date of the CARD Act," the letter said. The CARD Act will limit the ability of credit card issuers to raise fees and interest from February 2010, so many companies have been increasing charges and rates in recent months ahead of the new law. The actions angered some lawmakers in Washington. Last month, U.S. Representatives Carolyn Maloney and Barney Frank introduced legislation that could speed up the implementation date of new credit card rules to December, citing the raise in fees and interest rates. Major credit card issuers to be affected include Citigroup (C.N), Bank of America, JPMorgan Chase & Co (JPM.N), American Express Co (AXP.N), Capital One Financial Corp (COF.N), and Discover Financial Services (DFS.N). (Reporting by Karey Wutkowski; Additional reporting by Juan Lagorio; Editing by Gary Hill)
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