How do FI Make Money

Financial institutions earn interest income primarily by:

• Charging fees for account maintenance
• Earning returns on investments
• Lending money to borrowers
• Providing foreign exchange services

Which of the following is NOT a common fee or service charge imposed by financial institutions?

• Account maintenance fees
• Wire transfer fees
• Interchange fees
• Rental income from properties owned by the institution

Financial institutions generate revenue by offering:

• Insurance services
• Financial advisory services
• Investment and asset management services
• Regulatory compliance services

Trading and investment activities in financial markets can generate income for financial institutions through:

• Loan interest payments
• Asset and wealth management fees
• Foreign exchange services
• Profits from successful trading strategies

Interchange fees earned by financial institutions come from:

• Policyholders
• Merchants
• Deposit account holders
• Borrowers

Financial institutions earn revenue from foreign exchange services through:

• Charging account maintenance fees
• Earning interest on foreign currency deposits
• Exchange rate spreads or fees charged for services
• Profits from trading foreign currencies

Asset and wealth management services provided by financial institutions generate revenue based on:

• Interchange fees
• Trading profits
• Assets under management or a percentage of the client's portfolio value
• Account maintenance fees

Insurance divisions or subsidiaries of financial institutions earn revenue primarily from:

• Investment returns on premiums
• Charging fees for foreign exchange services
• Asset and wealth management fees
• Premiums collected from policyholders

Ancillary services offered by financial institutions include:

• Foreign exchange services
• Insurance services
• Financial advisory services
• All of the above