Sep. 24--Some central Ohio bank customers will soon get a break if they overdraw their accounts by small amounts.

Starting early next year, JPMorgan Chase customers no longer will have to pay fees on accounts overdrawn by $5 or less. Bank of America is taking a similar step, eliminating fees on accounts overdrawn by $10 or less starting Oct. 19.

Chase also will reduce the number of daily overdraft fees a customer could be charged from the current six to three. And it will change its policy to recognize debit-card and ATM transactions as they occur, rather than paying the largest charges first, spokesman Jeff Lyttle said.

"We recognize there were some legitimate issues with the dramatic increase in the number of debit-card transactions that we're processing and how the number of small transactions in particular can create multiple overdrafts in a single day," he said. "We hope that these changes reflect the feedback we've gotten from customers."

Chase's overdraft fees are $25 for the first fee each year, $32 for the next four and $35 after that. At Bank of America, overdrawing an account by as little as $6 currently results in a $35 fee.

The changes come as credit-card reforms passed this year will soon limit banks' ability to raise fees and interest rates and require greater disclosure about costs. Banks also will have to give customers the choice to opt into over-the-limit programs for credit cards, which are similar to overdraft programs and charge consumers for spending beyond their credit limit. The new credit-card law will go into effect in February.

Huntington spokeswoman Maureen Brown said the Columbus-based regional bank already allows its customers to opt out of having their accounts accept charges that will overdraw their accounts. And the bank is "always reviewing our fee structure . . . and looking at ways to make things easier for our customers," she said.

National City, now owned by PNC Financial Services Group, recently reduced its fee for a customer's first overdraft in 12 months from $31 to $25, spokesman Fred Solomon said. He said the bank "continues to evaluate our overdraft policies to determine the best value for our customers."

Fifth Third spokesman Mark Erhardt said the bank is reviewing its policies, but it likely won't make any decisions until it gets "more clarity from (bank) regulators or Capitol Hill."

Having addressed credit cards, federal lawmakers are now shifting their sights to debit cards. Last week, Sen. Christopher Dodd, D-Conn., said he plans to introduce legislation that would require customers to sign up for overdraft protection.

Three-quarters of large banks have automated overdraft programs, according to a 2006 study by the Federal Deposit Insurance Corp. In 2007, banks earned about $28 billion from overdraft fees, according to Oliver Wyman, the parent company of Celent, a Boston-based consulting firm for the banking industry.

Bank analyst Bert Ely, president of Ely & Co., a Virginia consulting firm for financial institutions, said the changes were "a good move driven by the politics of the situation."

But, he said, banks will likely look to compensate for lost revenue from overdraft fees by raising interest rates on loans, charging higher fees for accounts and offering lower interest rates on deposits.

Mike Adelman, a lobbyist for the Ohio Bankers League, which represents 200 banks and trusts, said the changes by Chase and Bank of America are a "pro-consumer move" that will likely help attract new customers while retaining current ones.

"Intuitively, it's likely other (banks) will follow suit," he said.

Information from the Associated Press was included in this story.

tturner@dispatch.com

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