Bank Branch Banking

Bank Management &
Financial Services
BF465
UNILUS
2015
New
Average
Deposits interest of
K’000,000 new funds
Total
Marginal Marginal
interest
cost of
cost rate
cost of new funds
new funds K’000,000
K’000,000
Expected
marginal
revenue
Marginal
Total
revenue –
profit
marginal
earned
cost rate K’000,000
25
7.0%
1.75
1.75
7.0%
10.0%
+3%
0.75
50
7.5%
3.75
2.00
8.0%
10.0%
+2%
1.25
75
8.0%
6.00
2.25
9.0%
10.0%
+1%
1.50
100
8.5%
8.50
2.50
10.0%
10.0%
+0
1.50
125
9.0%
11.25
2.75
11.0%
10.0%
-1%
1.25