balance needed to avoid them -- continue to increase, according to a U.S. Public Interest Research Group report released Thursday.

The pending financial reform bill "will create fewer and larger institutions" and "less consumer choice" said Ed Mierzwinski, U.S. PIRG's consumer advocate. "Large, multistate institutions impose the highest fees."

Though small banks and credit unions still offer better deals than big banks, their fees are rising too. Consumers who opt for big banks with large automatic teller systems are trading off free ATM transactions with higher account fees, the report argues.

Regular checking account minimum balances were an average of $234.87 at big banks, $202.79 at smaller banks, and $111.59 at credit unions, according to the survey. The data were compiled from branch brochures of 526 banks in 33 states and the District of Columbia from March through June. The sample included 235 of the country's 300 largest banks and thrifts as ranked by deposits.

Since U.S. PIRG's last report in 1997, average monthly maintenance fees on regular checking accounts increased 1.4%, to $7.76, at large banks and 3.2%, to $7.12, at small banks.

However, 61% of 1,000 consumers participating in a telephone survey released in June by the American Bankers Association said they paid less than $3 a month in banking fees.

"Consumers are very savvy," said ABA spokeswoman Patricia Boerger. Those with direct deposit or credit cards at an institution can usually get reduced fees, she said.

Financial modernization would bring an expansion of competition, ABA executive vice president Donald G. Ogilvie said in a prepared statement.

"The industry has moved from fixed prices on relatively few products and services to 'a la carte' pricing," he said. "The (financial modernization) bill will bring more choices and lower costs."

The trends in the U.S. PIRG report are similar to a much larger study, the Federal Reserve Board's annual report to Congress on retail fees. The most recent report, which was released this summer with data collected last year from more than 1,000 institutions of all sizes nationwide, found that the average minimum balance for checking rose $19.20, to $498.61, at all banks and $30.52, to $410.97, at thrifts. The monthly maintenance fees rose 34 cents, to $6.42, at banks and 16 cents, to $5.94, at thrifts.

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