Understanding the management of Bank of America is now next to impossible. What makes them want to anger 50 plus million solid retail customers while their entire operation is in damage control? Five million customers from the bank I headed joined this group when B of A acquired it in 1992.

The company's stock is traded at less than 30% of book value and they have become the target of numerous multi-billion-dollar lawsuits and claims pertaining to their mortgage operations. The bank and its management have been characterized in the press and political circles as greedy and heartless and are currently perceived as unresponsive to the expectations of their shareholders, customers and the financial system

Down, but not out, is the best way to describe the challenges facing the number one bank whose footprint encompasses 80% of the U.S. population. Some 57 million consumers and small business customers are served through its 5,900 offices and 18,000 ATMs. The banking giant holds 12.5% of all U.S. deposits, employs more than 275,000 workers and offers a broad range of products and services. B of A is very relevant to our financial future and recovery from the recent financial crisis.

With that sort of size and strength it's hard to imagine that their ability to recover from the mortgage crisis and restore their stock value could be so quickly and decisively jeopardized by this arbitrary pricing policy, but they found a way.

Last week they announced that because the recently enacted Dodd-Frank legislation had inappropriately limited their debit card interchange charges, all customers with less than $20,000 on deposit or a B of A mortgage would have to pay a new fee of $60 a year fee to use a debit card to pay for goods or services.

The direct bank operating costs of a debit card transaction are less than a penny, yet under Dodd-Frank pricing limitations the bank lost a motherlode of earnings from its retail customer transactions. This change has in effect told most Americans with limited balances to go find a better deal someplace, pay cash or revert back to the use of checks and their related account charges. All this after B of A has spent years trying to change customer behavior and personal patterns to eliminate paperwork and labor intensive processing in favor of more technology.

Maybe Moynihan and his staff didn't read what happened to Netflix when they tried to pull off a similar stunt imposing arbitrary fee increases to which their customers have revolted in large numbers. The $5 per month charge doesn't sound like much to many people, but to convey to their customers that their accounts don't matter much anymore is just economic suicide. If they had decided this change was necessary to maintain a fair level of earnings from consumer customers perhaps a modest charge based on a margin of profit over cost would have been acceptable. This move came across as arbitrary and "in your face" to both their customers and the government.

Thinking you can do whatever you want to your customers because you're the biggest and most economically significant bank in the country is reckless and foolhardy. This is especially true when you are under fire for what people feel are a history of mistakes, arrogance and greed.

My advice is to rethink this action in the perspective of the current situation and the necessity of regaining the support of your investors, the public and the government. You cannot be successful without the support of this group or the press. Begin to demonstrate humility, appreciation and understanding to all of those who made you successful in the past and will control those same elements in the years ahead.

Still to be answered in is whether this action caused the B of A website to go down for two straight days or is responsible for the resulting decline in B of A stock or perhaps both. Needless to say these are the only indications of the public response. If customers do speak their minds, it might just inadvertently give B of A new ideas for fees!

Robert H. Smith, the former chairman and chief executive of Security Pacific Corp., is a founder and director of Commerce National Bank in Newport Beach, Calif.