Estimating investment income from deposit balances 1.A bank determines the average ledger (book) balances in the account during the reporting period. 2.The average transactions float is subtracted from the ledger amount. 3.The bank deducts required reserves to arrive at investable balances. 4.Management applies an earnings credit rate against investable balances to determine the average interest revenue earned on the customer's account. 行贺影小号
Estimating investment income Estimating investment income from deposit balances from deposit balances 1. A bank determines the average ledger (book) balances in the account during the reporting period. 2. The average transactions float is subtracted from the ledger amount. 3. The bank deducts required reserves to arrive at investable balances. 4. Management applies an earnings credit rate against investable balance s to determine the average interest revenue earned on the customer’s account
Calculation of investment income from demand deposit balances Analysis of Demand Deposits: Corporation's Outstanding Balances for November Average ledger balances =$335,000 Average float $92,500 Collected balance$335,000-$92,500=$242,500 Required reserves (0.10)$242,500 =$24,250 Investable balance $218,250 Earnings Credit Rate: Average 90-day CD rate for November =4.21% Investment Income from Balances:November Investment Income =0.0421(30/365)($218,250)=$755.20 猫制酥价贸易大孝
Calculation of investment income Calculation of investment income from demand deposit balances from demand deposit balances Analysis of Demand Deposits: Corporation's Outstanding Balances for November Average ledger balances = $335,000 Average float = $92,500 Collected balance $335,000 - $92,500 = $242,500 Required reserves (0.10) $242,500 = $24,250 Investable balance $218,250 Earnings Credit Rate: Average 90-day CD rate for November = 4.21% Investment Income from Balances: November Investment Income = 0.0421 (30/365) ($218,250) = $755.20
Compensating balances In many commercial credit relationships, borrowers must maintain compensating deposit balances with the bank as part of the loan agreement. Ledger balances are those listed on the bank's books Collected balances equal ledger balances minus float associated with the account Investable balances are collected balances minus required reserves 麓的贫香小手
Compensating balances Compensating balances In many commercial credit relationships, borrowers must maintain compensating deposit balances with the bank as part of the loan agreement. Ledger balances are those listed on the bank’s books Collected balances equal ledger balances minus float associated with the account Investable balances are collected balances minus required reserves
Fee income 目 When a bank analyzes a customer's account relationship,fee income from all services rendered is included in total revenue. Fees are frequently charged on a per- item basis,as with Federal Reserve wire transfers,or as a fixed periodic charge for a bundle of services, regardless of rate of use. 的资5土号
Fee income Fee income When a bank analyzes a customer’s account relationship, fee income from all services rendered is included in total revenue. Fees are frequently charged on a peritem basis, as with Federal Reserve wire transfers, or as a fixed periodic charge for a bundle of services, regardless of rate of use