Though, i'm not a journey-just-come to the activities of the banking sub-sectors,
but i believe two heads are better than one.

Actually, I'm an investor, and I'm about buying a bank's stock.

           Meanwhile, I think it's a wise decision to know how this sub-sectors of the economy make their money before risking my hard-earned income with them(particularly in this time of reccession) .

I know we have a lot of INFORMED and EFFIKOS(learned ones) in the house.

Please, I want you to be sincere in your responses, your responses are priceless to me

they make their money with ur money and ur time---------lol

Like Bank PHB their major source of making money is from QUARTERLY CHARGES they illegally charge any one that eat their so called SALAD.

Like Bank PHB their major source of making money is from QUARTERLY CHARGES they illegally charge any one that eat their so called SALAD.[/b]

Banks usually make their money through interest from loans. However in Nigeria, banks make their money through HIDDEN CHARGES!!!!

Hey,

People just say things that they are not sure of. Ideal situation banks make money from interest on loan, COT charges for those using current accounts, treasury bills, management fees, security charges for safe keeping your valuable like will,gold etc, issuing of bank draft and guaranty and so on. But in Nigeria banks earn their money from hidden and ridiculous charges, forex, roundtripping, illegal funds transfer abroad and middle man for traders and importers.

@Boldvoice

You are correct. Nigerian banks' major loan customers are government

nigerian banks and cot charges, just criminal if you ask me , so much round tripping and hidden charges they hit you with,thats how they make their crazy profits every year.

Boldvoice:

Hey,

People just say things that they are not sure of. Ideal situation banks make money from interest on loan, COT charges for those using current accounts, treasury bills, management fees, security charges for safe keeping your valuable like will,gold etc, issuing of bank draft and guaranty and so on. But in Nigeria banks earn their money from hidden and ridiculous charges, forex, roundtripping, illegal funds transfer abroad and middle man for traders and importers.

My bank does not charge me for any of those items in bold.

Hey,

People just say things that they are not sure of. Ideal situation banks make money from interest on loan, COT charges for those using current accounts, treasury bills, management fees, security charges for safe keeping your valuable like will,gold etc, issuing of bank draft and guaranty and so on. But in Nigeria banks earn their money from hidden and ridiculous charges, forex, roundtripping, illegal funds transfer abroad and middle man for traders and importers.

I think what u said is true and correct to the best of my knowledge. Most of the banks make money through Forex and thru govt. as their best customer. COT charges, hidden charges, SMS rate, Treasury bills, payment for other services etc.

SHALOM

Waleluv,
I am afraid I am not very informed on how the Banks in Nigeria make their money.
From the scratch, in a normal setting, the basis of the income of banks comes from Borrowing and Lending.
See how much interest you receive on your funds if you deposit at the Bank and compare this with the interest rate you pay if you borrow money from the bank. The gap / margin/spead which of these you might want to call it.
On a bit higher level, you have banks that have financial experts in service who looks at the needs of individual clients and come up with specific financial solutions to the clients problems i.e. Clients who might have exposures in Foreign exchange due to international trade or client who might have exposures in the areas of interest rates fluctuation. This sort of tailored transactions are called OTC (Over the counter). These Banks will close a deal with the client, and close another back-2-back deal with another Bank, so they will not be left with an open position and exposure.
Further, you have investment Banks who have investment Bankers in service, they advice companies on M&A (Mergers & acquisition), they also guide companies that wants to generate fund from the public arena by enlisting on the stock exchange i.e. IPO / PO.

NIGERIAN BANKS ARE NOT DOING BANKING.
THEY ARE JUST TRADERS WHO SPECIALIZE IN ROUND TRIPPING (ILLEGAL SALES OF FOREX THROUGH BLACK MARKET)
AND EVERY OTHER DUBIOUS WAY OF FLEESING CUSTOMERS.

HOW MANY FOREIGN BANKS GO OUT SEEKING MILLIONS IN DEPOSITS?
THEY DEVELOP PRODUCTS INSTEAD TO HELP PEOPLE AND THEIR BUSINESSES GROW.

NIGERIAN BANKS WILL NEVER GIVE LOANS TO PEOPLE WHO NEED THEM.
INSTEAD THEY CONNIVE WITH ROBBERS IN GOVERNMENT, GIVE THEM LOANS WHICH THEY NEVER REPAY.

SEE WHAT HAS HAPPENED TO AFRIBANK, OCEANIC AND THE REST.
I GOOD EXAMPLE OF THE FALSEHOOD BANKING IN NIGERIA HAS BECOME.

[size=18pt]DISGUSTING!!! [/size]

The aggressive pursuit of bank deposits has always amused.

RichyBlacK:

My bank does not charge me for any of those items in bold.

Do you have a bank account in Nigeria ?

Nigerian banks are professors in extortion via hidden charges; try asking for your bank statement and then check it. They are having a field day because most of us do not take time out to examine things. Some of us even give the cashiers tips for giving us our own money again - how sad?

i think they make thier money from unlawful charges and borrowing people's savings 2 others in need: then they collect interest
http://money.howstuffworks.com/personal-finance/banking/bank4.htm

like skye bank; thru monthly charges on ATM card holder =N=50.00 PER CARD and majorly thru =N=200.00 PER transaction on amount less than or equal to 100,000 withdrawn thru the counter without ATM, E.TC ETC

They are all ARMED ROBBERS.

They are not doing Banking in any way.

Look at the kind of money Banks abroad make through real banking.
How many banks give out loans?
How many of them can boast of companies they have helped to nurture from scratch?

How can banks be selling recharge cards for God's sake.

They are like the Nigerian Police Force.

lol oga ooo, and all this time, i am praiseing nigerian banks for doing so well compare to other banks in the world.

I've always thought of the prosperity of Nigerian banks in the midst of a dreadful economy. But who cares. It's just like most institutions in Nigeria where corruption and lack of transparency is the norm. Corruption has conditioned us in a way that those that understand the irregularities in our system either do not have the capacity to effect change or just find a way to join the corruption train and cash in. Unfortunately, it's the better option in Nigeria at this time.

They make it through shares and shareholdings.

thanks for all your responses, if I must confess, I'm glad we have a great  number well learned and informed individual on this forum.

but are you in  any way saying the bank is a no go area if i want to invest my money

into shares

This excerpt from a Wikipedia article can probably give you the best overview on how banks make money.

A bank generates a profit from the differential between the level of interest it pays for deposits and other sources of funds, and the level of interest it charges in its lending activities. This difference is referred to as the spread between the cost of funds and the loan interest rate. Historically, profitability from lending activities has been cyclical and dependent on the needs and strengths of loan customers. In recent history, investors have demanded a more stable revenue stream and banks have therefore placed more emphasis on transaction fees, primarily loan fees but also including service charges on an array of deposit activities and ancillary services (international banking, foreign exchange, insurance, investments, wire transfers, etc.). Lending activities, however, still provide the bulk of a commercial bank's income.

In the past 10 years American banks have taken many measures to ensure that they remain profitable while responding to increasingly changing market conditions. First, this includes the Gramm-Leach-Bliley Act, which allows banks again to merge with investment and insurance houses. Merging banking, investment, and insurance functions allows traditional banks to respond to increasing consumer demands for "one-stop shopping" by enabling cross-selling of products (which, the banks hope, will also increase profitability). Second, they have expanded the use of risk-based pricing from business lending to consumer lending, which means charging higher interest rates to those customers that are considered to be a higher credit risk and thus increased chance of default on loans. This helps to offset the losses from bad loans, lowers the price of loans to those who have better credit histories, and offers credit products to high risk customers who would otherwise been denied credit. Third, they have sought to increase the methods of payment processing available to the general public and business clients. These products include debit cards, prepaid cards, smart cards, and credit cards. They make it easier for consumers to conveniently make transactions and smooth their consumption over time (in some countries with underdeveloped financial systems, it is still common to deal strictly in cash, including carrying suitcases filled with cash to purchase a home). However, with convenience of easy credit, there is also increased risk that consumers will mismanage their financial resources and accumulate excessive debt. Banks make money from card products through interest payments and fees charged to consumers and transaction fees to companies that accept the cards. Helps in making profit and economic development as a whole.

SOURCE: http://en.wikipedia.org/wiki/Banking#Profitability

Banks in Nigeria make thy money from hidden charges,Fraudulent Politician,Export and Import,Investment in Real Estate,Loans and Forex.
I can help any body in the House to Management thy Fund.
You can reach me on 2347027704563

One month I was charged as high as 25k by oceanic bank. Thats for all my monthly withdrawals. yet this bank could not buy me a laptop so they collect the money gradually. i filled the form and they processes it and at the end said, rejected, no reason. they only accept my deposits and withdrawals and cot.

As far as am concerned oceanic bank makes their money from stealing. can you imagine the number of western union transfer scams and atm fraud there.

Banks in Nigeria make thy money from hidden charges,Fraudulent Politician,Export and Import,Investment in Real Estate,Loans and Forex.
I can help any body in the House to Management thy Fund in Forex.
You can reach me on 2347027704563[b][/b]

I think Naija banks make 80% of their money from dubious charge they give to their customers

senani:

nigerian banks and cot charges, just criminal if you ask me , so much round tripping and hidden charges they hit you with,thats how they make their crazy profits every year.

RichyBlacK:

My bank does not charge me for any of those items in bold.

I beg which bank be that your bank?

Real Estate and Export and Import my foot!

Those are fronts.
Banks are the MOST guilty when it comes to round tripping and all the frauds.
If I had my way I will never enter a bank.

The same mould with PHCN and POLICE just that they dress better.

Nigerian banks are too callous.Just too callous.