TCF offers cash to open an account

TCF Bank has tried the usual bank incentives to get people to open an account: toasters, blankets, radios.

Now it's offering cash: $100.

Consumers can qualify when they open a checking account by placing at least $500 in deposits, making 10 qualifying withdrawals or having a total of $2,500 in combined balances in the first month, the Wayzata-based company said. No minimum balance is required.

Tony Davis, a Stifel Nicolaus bank analyst who follows TCF, called the sawbuck initiative a novel approach. "The essence of it is, TCF is trying to re-enter the market," he said.

The bank's checking strategy has evolved over the years. TCF introduced "totally free checking" accounts in 1986, paying for them with check charges and overdraft fees. The strategy drew depositors, and it inspired a lot of copycats.

But facing new mandated limits on such fees, TCF and other banks moved away from free checking over the past year and began charging monthly fees on accounts that previously had none.

Because of the image TCF has cultivated over 25 years, that may have disproportionately stung TCF and its customers, Davis said. But the bank saw some growth in the fourth quarter after it adjusted the conditions by which customers could bypass overdraft charges, he said.

The bank has offered the $100 cash incentive before, but only on certain holiday weekends, said spokesman Jason Korstange. '"There is a reason that banks do that. It's because it works," Korstange said.

Most of the bank's promotions run between 90 and 120 days, he added.

The latest incentive is part of a wider effort to be consumer-friendly. Earlier this year, TCF said it would switch by year's end from charging $35 or more each time a customer overdraws an account to charging a single fee of $10 to $25 if an account ends the day with a negative balance.

Peyton Green, a managing director at Sterne, Agee & Leach in Nashville, said banks are working harder to get customers. "I think you're seeing banks go on the offensive for consumer business, particularly new accounts," Green said.

Nevertheless, he said financial institutions like TCF Bank still face some headwinds as a debate continues over debit card transaction fees retailers pay to banks. TCF has filed a lawsuit in South Dakota to stop debit card limits.