Journal Article

How do banks make money? the fallacies of fee income


Abstract: In the first of two articles in this issue, the authors document the increasing importance of noninterest income at U.S. commercial banking companies and address two fundamental misunderstandings regarding this trend: the belief that fee-based activities provide more stable earnings than interest-based income and the belief that fee income flows chiefly from nontraditional, nonbanking activities.

Keywords: Income; Money; Payment systems;

Access Documents

Authors

Bibliographic Information

Provider: Federal Reserve Bank of Chicago

Part of Series: Economic Perspectives

Publication Date: 2004

Volume: 28

Issue: Q IV

Pages: 34-51