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Commercial banks

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What are the main sources of funds for commercial banks?

What are the major uses of funds for commercial banks?

What are the measuring cost of funds approaches do we have?

How an environment of low interest rates could pose problems for a commercial bank's liquidity?

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Solution Summary

This solution explains the major sources and uses of funds for commercial banks, the approaches to measuring cost of funds approaches used by commercial banks, and how low interest rates can be problematic for a commercial bank's liquidity.

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Banks make money based on interests and fees. Therefore, the main sources of funds for commercial banks are interest rates, monthly fees, overdraft fees, etc.

The funds deposited into our bank ...

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Keonda Grant-Taylor, MBA
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  • MBA, Webster Univeristy
  • Dual BS Degrees, University of South Carolina
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