Best and worst banks.

Americans are generally happy with their banks. And those with accounts at credit unions and online-only banks are even more satisfied.

Even so, some financial institutions are better than others in the services they provide, according to our latest survey of Consumer Reports members.

The more than 72,000 members surveyed last summer gave us their views on 148 financial institutions, including 69 traditional banks, 70 credit unions, and nine online banks.

They weighed in on a number of factors, such as customer service, wait times to see a teller, how easy it is to use the bank’s website and mobile app, and the convenience of hours and locations.

Landing at the top of the ratings chart were two relatively small regional banks, First Republic, headquartered in San Francisco, and Frost Bank in San Antonio. Others, including First National Bank of Omaha and Third Federal, based in Cleveland, also rated highly.

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While the nation’s biggest banks generally scored lower than the smaller banks, our respondents gave Chase a higher overall satisfaction score than they gave to Bank of America and Wells Fargo.

Other banking surveys, such as one from J.D. Power, also shows that many consumers appreciated Chase’s ATM and branch network, and mobile and online services, as well as the quality, clarity, and relevance on the advice provided about financial products it offers.

While Bank of America and Wells Fargo—which is still dealing with the aftermath of a fake-account scandal—fell behind in customer satisfaction, both say they are seeing improvements.

In CR’s survey, HSBC stood out among the lowest-rated banks. Our members gave the bank poor marks for five of the six attributes we considered. Fewer than half its customers were highly satisfied with the basics such as the bank’s branch locations, its hours, and its website.   

Matt Klein, an HSBC spokesman, says the bank is making changes. According to Klein, since our survey was fielded last summer, HSBC has started to institute a new internet banking platform, redesign its website, and extend branch hours.

“We take customer satisfaction very seriously,” Klein says.

Read our bank and credit union buying guide to get the results of our exclusive survey. You'll find out which financial institutions CR members like most and least and why

Alternatives to Traditional Banks

Overall, our members relied more on credit unions than banks for savings accounts, credit cards issued by the financial institution, loans, CDs, and mortgages.

One reason is that credit unions generally charge lower interest rates on loans. For example, credit unions were charging 2.79 percent on average on a 48-month new-car loan in the fourth quarter of 2017, while banks were charging 4.64 percent, according to the National Credit Union Association, using data from S&P Global Market Intelligence.

Members also gave high ratings to online-only banks. Among the nine in this category, USAA, Schwab Bank, and Ally Bank were rated the highest in overall customer satisfaction. These three companies also provided easy-to-use online transactions and useful websites.

Like credit unions, online banks also offer better interest rates than traditional banks.

“Ally provides higher-interest rates on my savings account and certificates of deposit compared with my local physical bank,” says Thomas Fararo, a retired Pennsylvania resident and one of the Consumer Reports members who graded banks and credit unions in our survey.

Ally, Capital One 360, and Discover were all paying 1.75 percent to 2.05 percent on 12-month CDs in March, compared with 0.02 to 0.07 percent paid by Chase Bank and Bank of America.

Dealing With Banks Behaving Badly

Given that the Consumer Financial Protection Bureau took enforcement actions against more than two dozen banks since 2012, it may be surprising that consumers like their banks so much.

But our findings suggest that the overwhelming majority of consumers overlook alleged wrongdoing on everything from mortgage redlining and illegal student loan servicing practices to charging for unauthorized overdraft protection and deceptive marketing. Only 11 percent of our surveyed members closed an account because of concerns about their institution’s lack of social responsibility.

“I don’t think that means consumers are letting banks off the hook for their bad practices,” says Christina Tetreault, senior staff attorney for Consumers Union, the advocacy division of Consumer Reports. “It could very well be that consumers can’t get over the obstacles to switching banks.”

Those obstacles include the time it takes to transfer direct-deposit payments to a new account and making new automatic bill payment arrangements.

What to Consider When Choosing a Bank

Not every kind of bank will work best for your needs. Here’s what to consider if you are planning to open a bank account.

Megabanks
Bank of America, Chase, and Wells Fargo, as well as most large national banks, have a significant nationwide presence of branches and ATMs. Many offer state-of-the-art digital banking platforms. And because high-profile brands are under constant attack by cybercriminals, megabanks have sophisticated security systems, which include fingerprint log-in for mobile banking and voice- and face-authentication systems. But when it comes to customer service, you’ll do better at credit union or regional bank.

Credit Unions
Credit unions are among the highest-rated services we’ve ever evaluated, with 96 percent of our members highly satisfied vs. 80 percent for the three biggest national banks. That satisfaction is driven by good customer service, not surprising when you consider that credit unions are owned and managed by their members. Credit union members usually have access to free checking, higher interest rates on certificates of deposit, and significantly lower rates for credit card and auto loans.

One difficulty can be that membership eligibility is limited because credit unions are often linked to an employer or a group, such as a labor union or church. But community-based credit unions have more relaxed rules, and almost anyone is potentially eligible to join a credit union somewhere. To find one (and check eligibility), go to mycreditunion.gov.

Online Banks
Virtual banks have the edge when it comes to connecting with customers electronically. They also provide significantly higher yields on savings products. Many have arranged for free access to ATM networks, so you can easily withdraw funds. But getting a human to talk to you can be difficult, and the services offered are often more limited than at a traditional bank.

Smaller Regional and Community Banks
If you’re looking for more personalized service, you’re more likely to find it here rather than at a big bank. When customers phone the 24-hour call center of Frost Bank, for example, they get a human being, not a recording.

Because most community banks have only about four to seven branches, according to the Independent Community Bankers of America, accessing funds can be an inconvenience and expensive when you’re away from home.