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Non-Tech : NetBank(NTBK)-formerly Atlanta Internet Bank

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To: jjs_ynot who wrote (529)	5/27/1998 10:07:00 AM
From: Les White	Read Replies (2) of 2414

>>any new deposits will be accretive to the bottom line<< Dave, you've got the right idea but the wrong terminology. I think you mean to point out that new revenues will be accretive. Deposits cost money because the bank is paying interest to the customer therefor it is an expense. It is the loans or assets that provide the income which generate the revenues that drop to the bottom line. A 30% increase in deposits does not necessarily generate a 30% increase in revenues unless they are put into corresponding loans. It's the asset/revenue side of the equation that the author was calling into question. If AIB is successful in originating their own loans then their earnings per loan should actually increase. Technically speaking, Les

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