Bank of America Corp., seeking to attract new clients, offered free online stock trades to customers with accounts of at least $25,000, sending shares of discount brokers lower.

The second-largest U.S.bank said customers in New York, Boston and other cities in the northeast U.S. will get 30 free trades a month so long as they maintain the minimum balance in any combination of accounts. Such trades usually cost $5 to $10, meaning customers may save as much as $3,600 a year. Bank of America said the program, which is effective immediately, will be extended nationwide over the next few months.

Online brokers “will probably have to follow suit” with price cuts, an analyst at CRT Capital Group in Stamford, Connecticut, who rates E*Trade a buy, Thomas Kaylor, said. “By giving away free trades it reduces some of the incentive customers have for moving assets over to online brokers.”

Bank of America’s move ratchets up competitive pressures that already forced Schwab, TD Ameritrade and E*Trade to slash commissions. The Charlotte, North Carolina-based company expects to recover the cost of free trades by luring customers into fee-paying products such as mortgages and checking accounts, services that not all discount brokers can match.

The prospect of customer losses and lower profits sent shares of San Francisco-based Charles Schwab Corp., the biggest discount broker, down as much as 9.5%. TD Ameritrade Holding Corp., which ranks third and is based in Omaha, Nebraska, dropped as much as 12%. New York’s E*Trade Financial Corp., the No. 4 online broker, fell as much as 11%.

Charlotte, North Carolina-based Bank of America fell 73, or 1.3%, to $53.95 in 11:33 a.m. composite trading on the New York Stock Exchange.

E*Trade’s chief operating officer, Jarrett Lilien, said in an interview that his company doesn’t expect to lose customers or plan on cutting prices.

“It’s a non-event, and all of this hoopla will disappear shortly,” Mr. Lilien said. “People distrust things that are free, and when they do the math they’ll realize that when you pay nothing you get nothing.”

E*Trade charges $9.99 per trade for “active” traders and investors, customers who execute at least 30 transactions a quarter or have $50,000 in their accounts, spokeswoman Pam Erickson said. “Main Street investors,” or those that don’t meet the minimums, pay $12.99, she said.

A special advertised on E*Trade’s Web site offers customers who open an active-trade account 100 free trades for the first 30 days. To qualify, they have to make a $1,000 minimum deposit.

“Unlike most other financial service companies we do not measure profitability on a single product basis,” Liam McGee, president of Bank of America’s global consumer and small-business banking unit, told reporters on a conference call. “We’re interested in building quality relationships with our customers and measuring profitability on an aggregate basis.”

Bank of America in December cut stock-trading commissions to $14 from $19.95 for customers who didn’t have accounts with the bank. For those who did have personal checking accounts, the discounts were steeper.

Online brokers could lose even more business if other large banks decide to offer free trades, Mr. Kaylor said.

San Francisco’s Wells Fargo & Co., the fifth-biggest American bank, in June 2005 began offering 50 free stock and mutual fund trades for customers with more than $250,000 in assets at the company. Trades after that cost $9.95, down from $19.95 for stocks.