How does the bank make money?

Question

How does the bank make money?

Answer 1

From intrest.

Investing money in your bank account.

If you don't pay them they repo your house.

Basicly thats how they make money

Charging for withdraws

Ect.

Answer 2

commercial banks make money through-

-the interest on loan given by them.

-charges for the services provided by the bank(bank overdraft, discounting facilities, credit card, debit card etc)

actually the difference between the interest income & the interest expenses on deposit is considered as the income of the bank.

Answer 3

the bank takes your deposit and gives you one dollar a year interest the bank lends me the money you deposited  and charges me two dollars a year in interest the bank keeps the dollar

Answer 4

This is a good question and the answer might anger or surprise you.

Banks make money when the income from loans to customers exceeds the interest paid to depositors.

Basically this means that you gotta come up with more of that sweet cash than they gave you to spend (on the promise you'll pay it back). This is called interest, and it exemplifies EVERYTHING that is backwards and wrong about our current economic system.

Answer 5

Most of their money is made through junk stocks.

While many people put their money in the bank, the bank uses all of the deposits and interest made from loans to buy stocks and bonds. They make a profit from the stocks and bonds, and this is their income. When they have invested into the stock market into junk bonds instead of through good solid stocks, then the stock market has ups and downs and they lose money when their stocks are down. This is why banks are closing. They have used your money to invest in bad stock investments and then they lost your money. It is okay to them though because the government insures your money up to 100k. When a bank closes their doors due to losses in the stock market, the government guarantees to give you your money back up to $100k. That is a government bail out. You've loaned them the money, they lost it, and then the gov. pays their loans for them.

They actually make very little on interest loans bcause they also pay interest to people on cd's and investments that people use to make money. The interest they make from people balances out the interest they pay out. The real money is made in the stock market.

Answer 6

Banks make money in lots of ways.  They charge you fees for services, take a percentage on curacy exchanges, charge interest on loans and invest deposits.

Answer 7

I know that when you put money into the bank you are giving them permission to uses your money for loans. When they make loans the people who ask for the loan have to pay it back with interest. And maybe its from the interest. Im not to sure where it all comes from but i know thats one part of it.

Answer 8

basically they take the money on deposit and they make more.

$1000.00 on deposit. they are able to lend $10,000.00 and charge interest accordingly.   watch this video ..

www.youtube.com/watch?v=oIo7IYVCIXM