U.S. Bank has lost millions on MSP Airport ATMs

U.S. Bank is losing hundreds of thousands of dollars each year on its 17 ATMs at Minneapolis-St. Paul International Airport.

Because the losses are expected to worsen as consumers bypass cash machines and more vendors accept credit cards, U.S. Bank is asking for a better lease agreement with fewer ATMs at the airport.

A memo to the Metropolitan Airports Commission's Management and Operations Committee details the economics of ATMs and how much banks can lose even in well trafficked places with captive audiences like the Minneapolis airport, which serves 35 million passengers a year.

The bank pays the airport a $636,000 annual minimum plus half of the $3 fee that non-customers pay at U.S. Bank's ATMs. Minneapolis-based U.S. Bank paid the airport $836,000 last year and kept about $200,000 in transaction fees, according to the memo.

The airport put the ATM contract out for bid last fall. Only U.S. Bank responded, telling the airport that it couldn't operate under the old terms because it lost $2.5 million over the previous five years, according to the memo. That comes out to an annual loss of nearly $30,000 per machine.

Worse, according to the memo, is that ATM transactions declined 15 percent from 2010 to 2015 and will keep deteriorating by 2 to 5 percent annually.

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