Managing the process of distribution of bank profits

Managing the distribution of profits of the bank - is the process of decision-making on the further use of profits in accordance with the objectives of the bank. As a rule, the allocation of profits is determined by the general meeting of shareholders (founders) for the year ahead, and the resulting distribution of profits allegedly meeting of shareholders (founders) for the year. Distribution of profits made in accordance with a specially designed policy of the bank, which was based on dividend policy. The policy of profit distribution is: reflect the requirements of the overall development strategy of the bank, to provide increased market value to form the required number of resources for further development bank to provide financial interests of shareholders and staff of the bank. Policy-making bank's profit distribution is ensured by its use in key areas, represented bank's net profit is distributed as follows: 1. Profits are capitalized (retained earnings): formation of funds, funds aimed at the development bank. In the normal course of business and profit banks set up special funds, which are inserted in the bank's own capital calculation. The most important of funds created by banks, there is a reserve fund. This fund is established to cover unforeseen losses in the bank's activities on all counts of assets and off-balance sheet commitments. Topic: Fundamentals of Financial Management Bank