The main profit of banks is the difference between interest on deposits (deposits) and interest on loans issued. In addition, additional income is generated by currency conversion operations, commissions for payments and transfers, rent of bank cells and safes, etc.
Instructions
Step 1
Most of the financial transactions with money, securities, carried out by individuals and legal entities, go through the banking system. Banks issue loans, accept deposits, carry out currency exchange operations, carry out money transfers, process payments, etc.
Step 2
At the same time, the bank itself is a legal organization with its own capital, costs and profits. The bank's profit is a positive financial value at the end of a certain period. The profit is added to the capital of the credit institution and ensures the payment of dividends to shareholders.
Step 3
To calculate the bank's profit, it is necessary to deduct expenses from all income received. The bank's income includes interest and additional income. Net interest income is the profit in the form of the difference in interest on deposits (deposits) and interest on loans issued.
Step 4
Additional (or operating) income is the difference between operating income and expenses. Operating income is a positive result of transactions in securities trading, attracting additional capital from other organizations, revaluation of securities, from operations with foreign exchange and precious metals, leasing of cells and safes, receiving commissions for transfers and payments, etc.
Step 5
Operating expenses - a negative result of additional bank operations, as well as personnel costs, depreciation of fixed assets and property, advertising costs, communication services, personnel training and advanced training, security, deductions to reserve funds, etc.
Step 6
The bank's net profit is the amount of profit remaining after taxes and other mandatory payments to the state budget.
Step 7
The profits of central state banks additionally include the so-called seigniorage income, which is generated by issuing money. This is the difference between the cost of manufacturing a banknote and its face value.
