Term of the Day: Cost Of Funds

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	INVESTOPEDIA Term Of The Day September 30, 2015 Cost Of Funds Cost of funds is the interest rate paid by financial institutions for the funds that they deploy in their business. The cost of funds is one of the most important input costs for a financial institution, since a lower cost will generate better returns when the funds are deployed in the form of short-term and long-term loans to borrowers. The spread between the cost of funds and the interest rate charged to borrowers represents one of the main sources of profit for most financial institutions. Breaking It Down: For lenders such as banks and credit unions, cost of funds is determined by the interest rate paid to... Read More Related to "Cost Of Funds" The Best Way To Borrow From time to time everyone needs to borrow money, whether to start a new business, erect a new backyard deck... Read More Will Corporate Debt Drag Your Stock Down? When you invest in a company, you need to look at many different financial records to see if it is... Read More Loan Loss Provision Banks set aside loan loss provisions to cover losses from bad loans. Loan loss provisions serve almost like... Read More Recently Added Definitions Franchise A franchise is a type of license that a party (franchisee) acquires to allow them to have access to... Read More Derivative A derivative is a security with a price that is dependent upon or derived from one or more... Read More Related Definitions Financing Squeeze Non-Operating Expense Credit Crunch Interest Rate Net Interest Margin Past Terms of the Day Cost Accounting Capitalized Cost Dividend Payout Ratio Interest Coverage Ratio Receivables Turnover Ratio You are currently subscribed as: mondemand.forex@blogger.com Unsubscribe | Unsubscribe From All | Manage Profile Investopedia US, A Division of IAC. Copyright © 2015, Investopedia, LLC. All Rights Reserved Follow Us: