What is the largest operating expense for a bank?

Question

Quizplus · Accepted Answer

The largest operating expense for a bank is typically the interest paid on deposits. Banks rely on deposits to fund their lending activities, and they must pay interest on those deposits in order to attract and retain customers. This interest expense can be significant, particularly if interest rates are high or if a bank has a large number of deposits. While employee salaries and benefits are also significant expenses for banks, they typically do not exceed the interest expense on deposits. Interest paid on loans from the Federal Reserve or other banks may also be an expense, but these are typically smaller than interest paid on deposits.

What Is the Largest Operating Expense for a Bank