As TD Bank works out problems, competitors benefit

While TD Bank works to resolve a computer problem that has left customer accounts out of date, local competitors say they have benefited from frustrated people willing to switch banks.

Citizens Bank said that "thousands" of people had taken them up on a promotion last Friday aimed at luring new customers. Under the offer, which started Saturday, customers who open a new checking account with Citizens get $100 automatically deposited into their new account.

The bank said that the number of new accounts was seven times normal volume but would be no more specific than that.

Other banks, such as Wachovia, National Penn Bank and PNC, said they are conducting only their normal marketing activities. PNC said that it, too, was seeing a surge in new customers from TD Bank; the others said they have not been tracking the source of their new customers.

"Our focus is always to help customers rather than focus on the weaknesses of our competitors," said Kelly Finch, market manager of retail banking at PNC Bank.

That said, Finch added: "We have seen a significant interest in new customers coming through our door and switching over to PNC. A significant number are from TD Bank, but they are not the only ones."

Jim McLaughlin, senior vice president and regional manager for Citizens Bank, said the response to the $100 promotion has been so favorable that all Citizens branch offices will extend their hours and remain open until 8 p.m. through Wednesday.

The banks that have benefited declined to give specific numbers, given the competitive nature of the industry.

Meanwhile, TD Bank experienced some delays in overnight posting, but is making progress, TD Bank spokeswoman Rebecca S. Acevedo said today.

"TD Bank account balances are currently up to date," she said. "Please note transaction processing usually does not happen over the weekend."

The problems at TD Bank N.A., formerly Commerce Bank, began the weekend of Sept. 26-27 when the bank tried to merge the former Commerce Bank's system with one at a bank it had acquired in Maine. The company has been trying to process all credits to accounts, including direct deposits, before it processes all debits to accounts, to avoid generating fees.

Over the last week, some TD bank customers have complained of checks not being deposited into their accounts, resulting in overdrafts or in missed transfers among accounts. Others who checked their balances couldn't tell whether deposits had been credited or whether automatic bill payments had been made.

A Citizens Bank official downplayed any connection between the timing of the promotion and TD Bank's problems.

"Citizens Bank has been playing offense aggressively all through 2009," said Dan Fitzpatrick, Citizens Bank's local chief executive officer and president. "This is very consistent with the approach our bank has been taking. We really want to grow our market share. This is a very competitive bank market."

Based on the latest figures, which are from June 2008, TD Bank has a 12.9 percent market share ($15.24 billion) in the Philadelphia region, based on deposits; Citizens Bank has a 12.5 percent share ($14.8 billion); PNC Bank has an 8.2 percent share ($9.68 billion); Wachovia has 20.9 percent ($24.66 billion); and National Penn Bank has 1.63 percent ($1.92 billion).

Acevedo at TD Bank said the company was doing whatever it could to keep its customers informed, and would reverse any fees, charges, or interest incurred because of the disruption.

"We are sorry for the inconvenience this has caused them, and we thank them for their patience and understanding," she said.

But South Philadelphia resident Joshua Mattucci, 31, a clerk at Wawa and a father of two, said he'd had enough of TD Bank. He opened a checking account today with Citizens Bank and said he would be moving the rest of his funds from TD Bank tomorrow.

Mattucci, who had been with Commerce Bank for seven years, said events of the last week caused him to make the switch. He said that, last Thursday, he could not access his money with his debit card at a local convenience store and gas station in South Philadelphia.

In addition, Mattucci said, his paycheck, which he receives through direct deposit, landed in his account two days late.

"If you cannot access your funds, you cannot access a major part of your life," he said. "Your life is on hold because of a massive networking mistake by TD Bank."