What is the interest rate the bank is charging the customer

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Reference no: EM131928172

The bank has determined the information below for one of its customers.

This customer wants to borrow $1,000,000 but will maintain an average deposit balance in its account of $200,000.

What is the interest rate the bank is charging the customer on the funds they have borrowed?

Expected Revenues		Expected Costs
Interest Revenues	$1,000,000	Deposit Interest	$30,000
Commitment Fee	$15,000	Cost of Other Funds Raised	$890,000
Deposit Service Fees	$5,000	Loan Processing Costs	$8000
Agency Fees	$6000	Activity and Record Keeping Costs	$16,000

Reference no: EM131928172

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