Why are global banks hesitant to accept U.S. citizens or residents as clients, even when they fully comply with IRS reporting?

It is the cost of compliance that is huge. Even if compliant then there is always the continued issue of keep in up with the regulations and reporting which is an added burden.

It is then becomes a question of is it worth it? Most banks unilaterally agree it is not worth the effort and simply deny banking facilities to US citizens.