Cost of funds


Also found in: Acronyms.

Cost of funds

Interest rate associated with borrowing money.

Cost of Funds

The amount of money paid in interest on a loan. The cost of funds is an expense for both personal and business loans. It also refers to the interest rate in addition to the absolute amount in interest.
References in periodicals archive ?
Hedged / Effective cost of funds (non-GAAP measure)
The group has suggested that if banks continue to use the weighted average cost of funds because of their deposit profile or any other methodology that may result in differentiation between old and new customers, their boards should ensure that this differentiation does not lead to discrimination between borrowers.
Because of this type of rate fluctuation, it is important that credit unions take the long view when they forecast their future cost of funds.
An unusually steep and sustained decline in the cost of funds to issuers and the lingering effects of the last recession, which saw outstanding balances on credit cards grow at a much reduced pace, have exerted downward pressure on credit card interest rates.
The market alternative cost of funds is 8%, the savings account interest expense is 4% and the service expense is 2%, representing a cost advantage of 2% (8% - (4% + 2%)).
To avoid whipsaws against the government when a taxpayer's internal cost of funds falls below the selected AFR, the election should be deemed an accounting method requiring consent of the Commissioner to change.
Our cost of funds will come to around 10 per cent after meeting all liabilities.
The state run bank said that it was confident of meeting its targets as it expects an increase in credit and some benefit accruing from a fall in cost of funds.
A lower cost of funds will not induce a company to buy new equipment when current capacity is underused or build another office building that no one will occupy.
In addition, the cost of funds is a relatively less important component of the total cost of credit card operations than it is for other types of credit.
5) Average cost of funds is calculated by dividing annualized interest expense by the Company's average borrowings.
USEY is committed to growing long-term shareholder value by acquiring and enhancing undervalued high potential 'clean and green' energy assets; supporting our businesses with strong and experienced managers; improving our capital structure to reduce cost of funds and increase available growth capital; and maximizing USEY's after-tax income," Mr.