Main Features of the Banking Business Model

Alessandro Santoni and Federico Salerno
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Alessandro Santoni: European Central Bank
Federico Salerno: European Central Bank

A chapter in How to Value a Bank, 2023, pp 5-13 from Springer

Abstract: Abstract Banks are very different from other industries. The business model is mainly based on collecting deposits from customers and granting credits or invest in securities on their own account. This apparently easy business model is, in fact, a complex one. The public role of banks and the potential impact from their default in society has led regulators to introduce a significant quantity of rules designed to mitigate the risks arising from this business. Given their peculiar business model, banks can be particularly challenging to value and require a wholly different approach relative to industrial entities.

Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sptchp:978-3-031-43872-1_2

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DOI: 10.1007/978-3-031-43872-1_2

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