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By paying out less in interest on deposits than it earns in interest on loans

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Alphonso Nicolas

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3y ago
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11y ago

By using depositors money to make loans and charging interest on these loans. They then pay less interest to the depositors than they charge borrowers, the difference is the banks' profit.

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Q: How does a bank make most of its profit on it business?
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How does a bank make most of its profits on its business?

By paying out less in interest on deposits than it earns in interest on loans