Answer:
A bank, also known as a credit institution or deposit entity is a financial company that is responsible for raising funds in the form of deposits, and lending money, as well as the provision of financial services. Banking, or the banking system, is the set of entities or institutions that, within a given economy, provide bank services.
Knowing that banks pay an amount of money to people or organizations that deposit their resources in the bank (interest on deposits) and that they charge money for giving loans to those who request them (placement interest), we can ask where a bank gets from Your profits. The answer is that placement interest rates, in most countries, are higher than interest rates; so that banks charge more to give resources than they pay to capture them. The difference between the placement interest rate and the deposit interest rate is called the intermediation margin. Banks, therefore, obtain more profits the larger the margin of intermediation.
