Banking Fee Based Business

Overview


One of a banks sources of revenues is fees that the bank collects for services.

  • Deposit Account Fees
  • Loan Origination Fees
  • Load Servicing Fees
  • Asset Management Fees


The fee based business of a bank can be valued in much the same way as other non-financial firms. (see valuation)

Discounted Cash Flow


The fee based business is particularly amenable to discounted cash flow analysis.

A simple present value calculation can be performed on the average fees collected and assuming a growth rate of the fees.

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