Banks offer perks to entice high-net-worth individuals to do business with them. Because those individuals add more to a bank's assets under management (AUM) compared to ordinary, non wealthy account holders, banks have a strong incentive to create rewards programs.

Citigroup Inc. (NYSE: C) and Bank of America Corp. (NYSE: BAC) have niche programs that provide a host of rewards to account holders with balances above a minimum threshold. Citigroup offers the Citigold program for customers with more than $200,000 between their deposit, retirement and investment accounts. Bank of America's Preferred Rewards Gold program is available for customers with total balances above $20,000 between their Bank of America banking account and Merrill Lynch investment accounts. Customers with balances above $50,000 or $100,000 can join the Preferred Rewards Platinum or Platinum Honors programs, respectively.


Citigold provides the following perks and rewards.

Waived monthly service fees: Citigold customers enjoy no monthly service fees on their checking accounts as long as they maintain minimum balances across their deposit, retirement and investment accounts. Effective November 2016, customers must maintain a combined average monthly balance of $200,000 to remain eligible for the Citigold program.

Rewards points: Citigold customers earn rewards points, known as ThankYou Points, for direct deposits or enrollment in online bill pay from a Citigold account. Customers can redeem these points for travel discounts, gift cards and even cash.

Additional fee waivers: Overdraft protection transfer fees, checkbook order fees, stop payment fees, incoming wire transfer fees, out-of-network ATM fees and money order fees are not charged to Citigold customers.

Loan discounts: Mortgage customers enrolled in Citigold can choose between reduced closing costs or a 0.25% interest rate reduction. Citigold customers can apply for home equity lines of credit (HELOCs) and personal loans at reduced rates that are based on the prime rate. Numerous restrictions apply, with good credit being perhaps the most important. Additionally, customers who close their Citigold accounts before paying their discounted loans back may incur fees and have to pay back the discounts they were given.

Bank of America

Bank of America's Preferred Rewards program offers three tiers based on account balance: gold, platinum and platinum honors. The rewards increase as customers move into higher tiers.

Interest rate boosters: Rewards customers receive a 5, 10 or 20% increase in money market account yield for gold, platinum and platinum honors status, respectively. However, this does not mean a platinum honors account holder earns 20% interest on his money market account. Rather, it means that, if the account is paying 1%, he earns 1.2%. As of 2016, the base rates for money market accounts are well below 1%, rendering this reward negligible for the time being.

Credit card rewards: Members receive a 25, 50 or 75% boost in credit card rewards, based on their tiers.

No-fee ATM transactions: Platinum members can make up to 12 yearly withdrawals from out-of-network ATMs for no fee, while platinum honors members receive unlimited no-fee withdrawals.

Mortgage, HELOC and auto loan discounts: Mortgage origination fees are reduced by $200, $400 or $600, depending on the member's tier. The interest rate discount on HELOCs is 0.125, 0.25 or 0.375%, also based on the member's tier. For auto loans, the rate discount is even higher per tier: 0.25, 0.35 or 0.5%. Credit approval is still required for all loans.

Free trades: Platinum and platinum honors members receive 30 or 100 free stock or exchange-traded fund (ETF) trades from their online investment accounts each month. This benefit is also available to gold members who make at least 15 self-directed trades per month.

Key Takeaways

While both programs offer a long list of perks, Bank of America's rewards are more robust and more explicitly defined. For customers who use their credit cards regularly, the boost in rewards of up to 75% is lucrative. Bank of America's discounts for mortgages and HELOCs are more straightforward and feature fewer restrictions, while unlike Citigroup, Bank of America offers generous auto loan reductions.

Moreover, only $20,000 is required to begin taking advantage of Bank of America's rewards, while Citigroup requires $200,000.

One area where Citigroup has the edge is ATM fee waivers. It offers unlimited waivers for all Citigold customers. Bank of America offers this perk only for platinum honors, which requires a minimum $100,000 balance.

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