Financial Plan
Bank of America: Bank of America states that it “is one of the world’s leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 69 million consumer and small business clients with approximately 3,800 retail financial centers, approximately 15,000 ATMs (automated teller machines) and award-winning digital banking with approximately 57 million verified digital users. Bank of America is a global leader in wealth management,
corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 4 million small business households through a suite of innovative, easy-to-use online products and services. The company serves clients through operations across the United States, its territories and more than 35 countries. Bank of America Corporation stock is listed on the New York Stock Exchange (NYSE: BAC).” (
https://newsroom.bankofamerica.com/content/newsroom/company-overview.html
) Funding Need: BOA is requesting funding to grow and launch larger loyalty rewards for its members. To offer more out of their grant program for nonprofit organizations. Source of Funding: Federal Reserve
(need eligible collateral
and basic mechanics of operations) and self-funding. Banks self fund through the loans they make to their clients and client deposits. Cost of Capital: Sources of funds that financial institutions can access for a cost can fall into several categories. The primary source of funds is bank deposits, which are also called core deposits. These typically come in the form of checking or savings accounts, and are generally obtained at low rates. Other categories include:
Shareholder equity
Debt issuance
Wholesale money, or cash that is found in money markets and lent by banks
Banks issue a variety of loans, with consumer lending comprising the lion's share in the U.S. Mortgages on property, home equity lending, student loans, car loans, and credit card lending can be offered at variable, adjustable, or fixed interest rates. Rates between 0%-25%. (
https://www.investopedia.com/terms/c/costoffunds.asp
) Bank of America’s current APR is “ 0% Intro APR† for 18 billing cycles for purchases, and for any balance transfers made in the first 60 days of opening your account. After the intro APR offer ends, a Variable APR that's currently 16.24% - 26.24% will apply. A 3% fee applies to all balance transfers.” ( https://www.bankofamerica.com/credit-cards/products/bankamericard-credit-card/
)
