Principal of banking Money multiplier


But these were still flowers. The basis of bank income is the principle of the multiplier, that is, an increase in opened a deposit in the bank in the amount of 1,000 rubles. By law, all banks are required to create reserves by storing a certain amount in a special account to protect the interests of depositors.The percentage of reservation is 5% of the deposit amount. In our case, it will be only 50 rubles. And the rest of the thousand – 950 rubles can be used at your discretion.For example, provide another client in the form of a loan at a percentage. But a little higher than the contribution (2 times). The borrower will spend money in a household appliance store that is serviced by our bank. And the funds come back again. Now the bank, after supplementing the reserve 47.5 rubles. (5% of 950 rubles), can use the money to issue other loans in the amount of 902 rubles. (950 – 47.5). This is how funds are placed until the money runs out. Each time, the share for the reserve (5%) is deducted from the amount in the account. And the remainder is transferred to the client as a loan. And each time the bank banco bicentenario del pueblo receives its profit in the form of interest for the use of funds.The bank may have problems if all depositors simultaneously want to receive their money. But such a situation is unlikely (although it threatens with serious consequences, up to bankruptcy).


For this reason, the bank banesco en linea in every possible way encourages the use of non-cash money. And he tries to motivate customers (using the carrot and stick method) to leave money in the account for as long as possible. In case of early closure of the deposit – loss of accrued interest. More favorable rates for long terms of deposit opening.

Stock market and their securities

  1. as an independent market participant;
  2. as a customer representative;
  3. produces its own financial products.

In the first case, a credit institution on its behalf acquires securities, mainly debt receipts ( bonds ). Profit is formed due to accruals on coupon income in excess of deposit rates. The bank can operate in the securities market on behalf of and at the expense of the client, that is, act as a broker. For each purchase or sale transaction, for example, of shares , made by a client , the bank charges a small penny in the form of a commission. The amount of commissions is hundredths of a percent of the transaction amount. But banco de venezuela en linea taking into account simply huge volumes of transactions and the role of the bank as an ordinary intermediary, we get a constant cash income that does not depend on external factors (growth or fall of securities).

self-respecting broker bank

In addition, each self-respecting broker bank has a line of products for which the client pays a fee. For example, trust management. You give money and the manager himself makes the operations, earning (or not earning) profit for customers. The bank reward is usually 10-30% for the result (profit). Additionally, there is a fee for annual maintenance – 2-4% of the total amount of client funds in management. We get that even in the event of a loss, only the client loses money. And the bank still gets its percentage for management. Banks successfully earn on mutual funds (mutual funds). Acting again as an intermediary between customers and the object of investment. The profit-making scheme is almost identical to trust management – various commissions from investors who want to sell or buy shares of funds. For the purchase and sale of shares will have to pay the bank from 1 to 3-5%. Moreover, for each operation separately. Plus annual management fee (regardless of financial result) – 1-3%. more informtion on banking

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